Dan asked that I post this and also let you all know that he will be opening our luncheon on Wednesday with an oil market update. If you are in the Houston area, don't forget to register for the luncheon, if you plan to attend (https://energyprospectus.com/earthstone-energy-inc-houston-luncheon/):
By Devika Krishna Kumar, Lisa Abramowicz and Tom Keene
(Bloomberg) -- The latest OPEC production cuts will prompt
a draw in oil inventories, sending prices into the low $90s,
Goldman Sachs Group Inc.’s Global Head of Commodities Research
Jeffrey Currie said in a Bloomberg TV interview.
“You’re going to be seeing substantial physical inventory
draws because of these OPEC production cuts, particularly in the
third and fourth quarter,” he said. “That’s going to push us up
into the low $90s.”
Oil prices have remained weak in the immediate wake of
Saudi Arabia’s pledge to cut more barrels as lackluster demand
and ongoing fears about economic growth shadow the outlook.
Money managers currently hold the most bearish stance across all
major oil contracts in more than a decade, exchange and CFTC
data compiled by Bloomberg show.
Higher interest rates have made it too expensive to keep
oil in storage and investor interest is unlikely to return until
inventories start to decline, Currie said. The net cost to hold
physical inventories is at about 13-15% in the current
environment.