On Tuesday, crude oil hit a fresh 2018 high of $64.89 per barrel, but then reversed and declined very quickly, erasing most of Friday increase. What encouraged oil bears to act and how did this decline affect the short-term picture?
The Energy Information Administration (EIA) released another EIA Drilling Activity report that raised its estimates for shale oil production without considering the realities on the ground. According to the report, the EIA says that U.S. shale oil production will increase by 111,000 barrels a day to 6.55 million barrels a day in February next month, and that production in the Permian Basin will surge by 76,000 barrels a day.
Apart from the crypto carnage today and news of the Dow’s fastest 1000-point rally in history, there hasn’t been an awful lot happening in other markets today, with the major FX pairs and gold being fairly stable.