Crude Oil Futures Could Fall in the Next Few Sessions

WTI and Brent crude oil futures  

January WTI crude oil (USL) (DWT) futures contracts fell 0.9% to $56.6 per barrel on December 13, 2017. Likewise, Brent oil (BNO) futures fell 1.4% to $62.4 per barrel on the same day. Prices fell for the second day.

A larger-than-expected increase in US gasoline inventories pressured oil (DBO) prices. The EIA published the data on December 13, 2017. It stated that US crude oil production hit a new record, which also pressured oil prices. In Part 3 and Part 4 of this series, we’ll discuss US production and gasoline data. All of these catalysts could weigh on oil (UWT) prices next week. Oil prices influence the United States Oil ETF (USO), which fell 0.9% to 11.33 on December 13, 2017.

Crude Oil Futures Could Fall in the Next Few Sessions

OPEC’s monthly report  

OPEC released its monthly oil market report on December 13, 2017. It estimated that non-OPEC production will increase by almost 1,000,000 bpd (barrels per day) in 2018. It’s 120,000 bpd more than the November estimates. The larger-than-expected increase in production from the US and Canada will add to non-OPEC supplies. The US crude oil supply is expected to increase by 1,050,000 bpd in 2018. It’s 180,000 bpd more than the November estimates. All of these factors could pressure oil prices.

However, the production cut extension will help oil prices in 2018. Moves in oil prices impact oil and gas producers (XOP) (XLE) like Denbury Resources (DNR), Carrizo Oil & Gas (CRZO), and SM Energy (SM).

Wall Street  

The Dow Jones Industrial Average Index (DIA) rose 0.3% to 24,585.4, while the NASDAQ (QQQ) rose 0.2% to 6,875.7 on December 13, 2017.

The S&P 500 (SPY) fell 0.05% to 2,662.8 on December 13, 2017. The financials (XLF) (VFH) and energy (VDE) (IEZ) sectors dragged SPY yesterday. However, the S&P 500 has risen almost 19% year-to-date.

In this series 

The EIA released its weekly crude oil inventory on December 13, 2017. In this series, we’ll discuss US crude oil inventories and production. We’ll also discuss US gasoline and distillate inventories.