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US Crude Oil Is at a 3-Year High

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Nov. 20 2020, Updated 11:10 a.m. ET

US crude oil

On April 18, 2018, US crude oil June futures rose 2.9% and closed at $68.47 per barrel—the highest closing level for US crude oil active futures since December 2014.

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Factors behind oil’s rise

On April 18, 2018, the EIA reported a fall of 1.1 MMbbls (million barrels) in the US crude oil inventories for the week ending April 13, 2018—0.6 MMbbls more than the market’s expected fall. The market expects that OPEC’s production cut deal might be extended into 2019 at OPEC members’ meeting June 22, 2018. Bullish demand drivers also helped US crude oil to make a new high. These factors were behind oil’s rise.

Oil-weighted stocks

On April 11–18, 2018, US crude oil June futures rose 2.6%. The following oil-weighted stocks could follow oil’s rise based on the past five trading sessions’ correlations with US crude oil June futures:

  • WPX Energy (WPX) at 96.7%
  • California Resources (CRC) at 93.4%
  • Oasis Petroleum (OAS) at 85.6%
  • Murphy Oil (MUR) at 84.4%
  • Callon Petroleum (CPE) at 84.4%

The oil-weighted stocks that might be impacted less by oil’s moves in the short term based on the past five trading sessions’ correlations with US crude oil June futures were:

  • RSP Permian (RSPP) at 20.4%
  • Occidental Petroleum (OXY) at -23.1%

These oil-weighted stocks are part of the SPDR S&P Oil & Gas Exploration & Production ETF (XOP). They operate with a production mix of at least 60.0% in liquids based on their latest quarterly production data. Liquids include crude oil, condensates, and natural gas liquids.

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