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WTI Drives Toward $60.00 on EIA Report

The weekly crude oil inventories cycle has come and gone, with April WTI futures making a break toward $60.00. Upon the 10:30 AM EST release of the EIA stocks report, bids piled into the market en masse, producing a rapid break above $57.00. For the time being, it appears that institutional money is ready to drive oil north for the spring season.

EIA Reports A Large Draw On Inventories

This week’s stocks reports have come in decisively negative. Traders have anticipated lower-than-expected supply for a while now, following OPEC production cuts and a severe North American winter. Energy bulls certainly got what they wanted this week, with both the API and EIA stocks figures coming in well below expectations. Here is a look at the hard data:

Event                                         Actual     Projected    Previous

API Crude Oil Stocks               -4.20M           NA             1.26M

EIA Crude Oil Stocks               -8.647M      2.842M        3.672M

The API and EIA statistics came in well below their previous releases, surprising analysts and investors. In the event this trend continues, a test of $60.00 may be in the cards to open March.

EIA Report Sends April WTI Crude Futures North Of $57.00

As you can see from the daily chart, April WTI crude has broken out to the bull on this morning’s EIA stocks report. Prices are up more than $1.25 and headed for a challenge of the Swing High at $57.81.

April WTI Crude Oil Futures (CL), Daily Chart
April WTI Crude Oil Futures (CL), Daily Chart

Overview: The daily uptrend in WTI is alive and well after a tough end to last week. Traders went long yesterday after the API release and today after the EIA report. For now, it is very likely that the $60.00 per barrel mark will be tested in the near future.

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Shain Vernier
US Analyst
Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.
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