Oil Price - Feb 21

[dan_s]

On 2/20/2017, Reuters reported that hedge funds and other money managers have amassed a very large bullish position in crude oil futures and options without so far having much impact on oil prices. Hedge funds raised their combined net long position in the three main derivative contracts linked to Brent and WTI by another 51 million barrels last week. Funds now hold a net long position equivalent to a record 903 million barrels of oil, according to an analysis of records published by regulators and exchanges. The combined net long position has a notional valuation of more than $49 billion, which is the highest since July 2014. Fund managers now have the most bullish view on oil since the first half of 2014, when Libya's exports were nearly halted by civil war and Islamic State fighters were racing across northern Iraq.

Top OPEC exporter Saudi Arabia's crude oil shipments fell in December to 8.014 million b/d from 8.258 million b/d in November, official data showed on 2/20/2017, as reported by Reuters. Estimates indicate compliance with the OPEC agreement to reduce production is around 90%. Reuters reported last week that OPEC could extend the pact or apply deeper cuts from July if global crude inventories fail to drop enough.

Speaking at the International Petroleum Week conference in London, Barkindo estimated that OPEC member states are about 90% in compliance with a global pact to cut production and noted the willingness of non-OPEC members to comply with the deal.

He expressed confidence in a higher level of compliance in the coming months from both OPEC and non-OPEC producers.

Barkindo added that a technical committee to monitor compliance with the agreement is expected to convene in Vienna on Wednesday.

Strong U.S. dollar keeps a lid on oil prices: http://www.marketwatch.com/investing/index/dxy/charts