Globally, crude oil traders take cue from the U.S. weekly surveys hence monitoring this data is of significant prominence. Also, crude oil is an international commodity so international crude data is important to follow. With US being the biggest consumer of crude oil in the world, one can draw some conclusions from its inventory levels, which impact the crude oil price movement.
For the week ended 18 March 2011. U.S. crude inventories rose 2.13 Mn bbls (W-o-W, as against market expectations 1.6 Mn bbls) and 1.5 mn bbls (Y-o-Y) to 352.8 Mn bbls, as imports rose. As we can see Crude oil inventories are at historically high levels.
Despite high inventories in US, crude oil price is trading at substantially high levels mainly due to geo-political issues like Libya etc. Hence over medium to long term, there is enough data to believe that the crude will come down substantially, once the geopolitical issues get settled.
If you enjoyed this article, please consider sharing it!
Well written article. Crude has come down 10-15% since last week.