WTI managed to break below the support (now turned into resistance) hurdle of 44.00 (R1) on Tuesday and yesterday, it continued its tumble to hit support at the 42.55 (S1) line, defined by the low of the 27th of October. The short-term picture looks negative and therefore, I would expect a clear move below 42.55 (S1) to prompt extensions towards our next obstacle of 41.80 (S2), marked by the low of the 28th of August. Taking a look at our momentum studies though, I see signs that an upside retracement could be looming for now before sellers decide to take in charge again, perhaps to test the 44.00 (R1) area as a resistance this time. The RSI rebounded from slightly below its 30 line, while the MACD shows signs of bottoming. On the daily chart, WTI printed a lower high on the 3rd of November. In my opinion, a break below 42.50 (S1) is now needed to confirm a forthcoming lower low and to turn the longer-term outlook back to the downside.
• Support: 42.55 (S1), 41.80 (S2), 40.50 (S3)
• Resistance: 44.00 (R1), 45.00 (R2), 45.70 (R3)
EIA Weekly petroleum Report
Gasoline Production Increased
U.S. crude oil refinery inputs averaged over 15.9 million barrels per day during the week ending November 6, 2015, 302,000 barrels per day more than the previous week’s average. Refineries operated at 89.5% of their operable capacity last week. Gasoline production increased last week, averaging 9.7 million barrels per day. Distillate fuel production decreased slightly last week, averaging about 4.9 million barrels per day.
Crude Oil Imports Up
U.S. crude oil imports averaged 7.4 million barrels per day last week, up by 434,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged 7.2 million barrels per day, 2.5% above the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 353,000 barrels per day. Distillate fuel imports averaged 136,000 barrels per day last week.
Crude Oil Inventories Remain High
U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 4.2 million barrels from the previous week. At 487.0 million barrels, U.S. crude oil inventories remain near levels not seen for this time of year in at least the last 80 years. Total motor gasoline inventories decreased by 2.1 million barrels last week, but are well above the upper limit of the average range. Both finished gasoline inventories and blending components inventories decreased last week. Distillate fuel inventories increased by 0.4 million barrels last
week and are in the middle of the average range for this time of year.
Propane/propylene inventories rose 1.6 million barrels last week and are well above the upper limit of the average range. Total commercial petroleum inventories increased by 2.6 million barrels last week.
Total products supplied over the last four-week period averaged about 19.8 million barrels per day, up by 1.2% from the same period last year.
Over the last four weeks, motor gasoline product supplied averaged about 9.3 million barrels per day, up by 3.4% from the same period last year. Distillate fuel product supplied averaged 4.0 million barrels per day over the last four weeks, up by 8.3% from the same period last year. Jet fuel product supplied is up 4.0% compared to the same four-week period last year.
WTI Price Below Average
The WTI price was $44.32 per barrel on November 6, 2015, $2.28 under last week’s price and $34.39 below a year ago. The spot price for conventional gasoline in the New York Harbor was $1.434 per gallon, $0.010 lower than last week’s price and $0.798 less than a year ago. The spot price for No. 2 heating oil in the New York Harbor was $1.494 per gallon, $0.081 above last week’s price but $0.860 below a year ago.
The national average retail regular gasoline price increased to $2.235 per gallon on November 9, 2015, $0.011 over last week’s price but $0.706 under a year ago. The national average retail diesel fuel price increased to $2.502 per gallon, $0.017 per gallon higher than last week but $1.175 lower than a year ago.