Crude oil futures
The WTI (West Texas Intermediate) crude oil (UWT) (USO) futures contracts for December delivery rose 0.4% to $54.38 per barrel on October 31, 2017. The prices are near the February 2017 high. Brent oil (BNO) futures contracts rose 0.7% to $61.37 per barrel on October 31, 2017—near the highest level since July 2015.
Brent and WTI crude oil price performance in October
Brent and US oil prices rose 6.8% and 5.2% in October 2017. Hopes of prolonging the ongoing production cuts by nine more months supported oil prices in October. Crude oil supply outages persisted in Kurdistan, which also helped oil prices. Higher oil prices benefit oil majors (VDE) (XLE).
Oil majors like ExxonMobil (XOM), Chevron (CVX), BP (BP), and Total SA (TOT) had strong 3Q17 earnings results due to lower costs. The oil majors have reduced ~$80 billion in capital expenditure since 2013. Shell (RDS.A) is expected to release its 3Q17 earnings report on November 2, 2017. US crude oil prices averaged $48.20 per barrel in 3Q17, which is 7.3% higher than the oil prices in 3Q16.
API’s US crude oil inventory estimates
On October 31, 2017, the API (American Petroleum Institute) released its weekly crude oil inventory report. It estimates that US crude oil inventories fell by 5,087,000 barrels on October 20–27, 2017.
Wall Street analysts estimated that US crude oil inventories would have fallen by 1,756,000 barrels during the same period. US oil (DBO) (USL) prices rose in post-settlement trade on November 1, 2017, due to the massive fall in US crude oil inventories.
The U.S. Energy Information Administration will release its crude oil inventory report at 10:30 AM EST on November 1, 2017.
The Dow Jones Industrial Average Index (DIA) rose 0.12% to 23,377.24 on October 31, 2017. The NASDAQ (QQQ) rose 0.43% to 6,727.67 on the same day—the highest level ever. The S&P 500 (SPY) rose 0.09% to 2,575.26 on October 31, 2017. The consumer staples (XLP) (VDC) and IT (XLK) (VGT) sectors helped SPY on the same day.
In this series, we’ll discuss the API’s gasoline and distillate inventory data. We’ll also discuss the US gasoline demand and OPEC and US crude oil production.