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Brent and US Crude Oil Futures Are near a 1-Week Low

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Crude oil futures 

April West Texas Intermediate crude oil futures contracts fell 2.3% to $61.15 per barrel on March 7, 2018. Brent oil futures dropped 2.2% to $64.34 per barrel on the same day. Both of the benchmarks had their lowest settlements since March 1, 2018.

The United States Oil ETF (USO) and the United States Brent Oil ETF (BNO) track US and Brent oil futures, respectively. USO fell ~1.7% to 12.3 on March 7, 2018, while BNO fell 1.7% to 17.7 on the same day.

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Drivers for crude oil futures  

Crude oil prices declined on March 7, 2018, due to the increase in US crude oil inventories and oil production.

The appreciating dollar also pressured oil prices on March 7, 2018. The US Dollar Index appreciated ~0.1% to 89.6 on March 7, 2018. The Power Shares DB US Dollar Bullish ETF (UUP) fell 0.1% to 23.4 on March 7, 2018. UUP tracks the US dollar’s performance.

All of these factors could pressure oil prices in upcoming sessions. US crude oil prices declined 0.8% on February 28–March 7, 2018. The ProShares Ultra Bloomberg Crude Oil ETF (UCO) decreased 0.3% during the same period. UCO aims to provide twice the daily return of an index of WTI crude futures contracts.

The PowerShares DB Oil Fund (DBO) increased 0.3% on February 28–March 7, 2018. DBO tracks the performance of the DBIQ Optimum Yield Crude Oil Index Excess Return and US Treasury bills. BNO was almost flat on February 28–March 7, 2018. The above chart shows that DBO outperformed other crude oil ETFs on February 28–March 7, 2018.

Series overview 

In this series, we’ll discuss US oil inventories and production as well as US gasoline and distillate inventories.

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