The market has been up and down lately, looking for direction in a stockpile of different news stories.
The market is still over supplied which has been pushing the market lower. For the past 9 weeks oil rigs and fracking wells have decreased in number in the United States. The US Energy Information Administration on Monday said it expects U.S. shale oil production to fall by 118,000 bbls/day to less than 4.95 million barrels a day in December. Crude storage in Cushing, Oklahoma, is still above 75% at over 53 million barrels.
OPEC which caused the drop in crude from $114 a barrel in 2014 to the $40’s recently scheduled a meeting for December 4th. Many think they will use their power to slow production therefore increasing the price of fuel. If prices were to stay at current levels, OPEC members would earn an annual $550 billion, nearly half the $1 trillion a year they were getting before the price crash, Mr Birol of the EIA, said.
Interest rates are expected to be raised by the FED. According to DTN news sources the FED raising rates next month would (the first time in nearly a decade) reduce the flow of cheap cash to market investors and reduce liquidity, potentially putting downward pressure to oil market.
