The April WTI (CLJ25) trading session settled at 72.48 (+0.38) [+.53%], a high of 73.14, a low of 71.73. Cash price is at 72.23 (+0.37), while open interest for CLJ25 is at 302,278. CLJ25 settled above its 5 day (71.66), above its 20 day (72.04), above its 50 day (71.76), above its 100 day (70.39), above its 200 day (71.47) and below its year-to date (72.98) moving averages. The COT report (Futures and Options Summary) as of 2/11/25 showed commercials with a net short position of -257,512 (a decrease in short positions by +16,534 from the previous week) and non-commercials who are net long +233,208 (a decrease in long positions by -11,736 from the previous week).
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Today’s Energy Information Administration petroleum data for the week ending February 14th 2025 show U.S. commercial crude oil inventories increased by +4.6 million barrels from the previous week (against a forecast of +3.2 million barrels), to a total of 432.5 million barrels, which is about 3% below its five-year seasonal average. U.S. crude oil imports averaged 5.8 million barrels per day, lower than the previous week by 488,000 b/d. U.S. oil refinery inputs averaged 15.4 million barrels per day, while operating at 84.9% capacity. The Strategic Petroleum Reserve, which is currently filled to multi-decade lows, remained unchanged at 395.3 million barrels. This is the fourth consecutive week of inventory builds reported by the EIA. Yesterday, the American Petroleum Institute estimated that U.S. crude oil inventories increased by +3.34 million barrels in the week prior, against a forecast of +2.2 million barrels. This is the fourth consecutive week of increased inventories reported.
President Trump announced yesterday that his administration plans to replenish America’s Strategic Petroleum Reserve, which has dropped to multi-decade lows and is now approximately 250 million barrels below its level from four years ago.
The current Arctic Blast making its way through the United States and Europe has disrupted production in North Dakota, disrupting 150,000 barrels per day, the state’s Pipeline Authority estimates.
Saudi Arabia hosted U.S. Secretary of State Marco Rubio and Russia’s Foreign Minister Sergei Larov in what was the first meeting between top U.S. and Russian officials since January 2022. No Ukrainian or European Union officials were present during today’s four hour meeting. Kremlin representative Dmitry Peskov said in a statement that the meeting was mainly for setting “preparations for potential Ukraine peace talks.” Ukraine’s President Zelensky said he would be cancelling his scheduled visit to Saudi Arabia, saying “We are honest and we are open for peace talks but I have taken the decision of not visiting Saudi Arabia as I don’t want to create a false image,” Bloomberg News reported that it had seen a draft statement from the G-7 nations, which proposes lowering the current price cap on Russian crude oil (set at $60 per barrel). The statement is expected to be released on February 24th, according to Bloomberg. Bloomberg reported that Russia’s crude oil production dipped to 8.962 million barrels per day in January. Russia has been faced with increased logistical problems since the U.S.’s latest sanctions on Russian oil shipments to China and India. Russia’s January production came in 16,000 barrels below its agreed upon OPEC+ quota. Bloomberg also reported that, according to ship-tracking data, around 60% of the active “shadow fleet” tankers sanctioned by the Biden Administration in January have ceased transporting crude oil entirely.
Elsewhere Russian Officials said that Ukrainian drones had hit a pipeline in Kazakhstan that transports roughly 1% of global crude oil supply, carrying about 1.6 million barrels per day. The Russian oil company Transneft said transit volumes could be reduced by 30%-40% and take up to two months to get completely back online. However Oilprice reported, citing sources who have seen official data, that Kazakhstan’s oil output has hit a record high despite the disruption.
Conflicting reports by Reuters and Bloomberg over the last few days via unnamed OPEC+ sources saying OPEC+ may delay production cuts further, while the former reports that that’s not going to be the case. Bloomberg reported that OPEC+ delegates are considering prolonging monthly supply increases set to begin in April. However this morning Reuters, citing unnamed OPEC+ delegates, disgusted this and Russian Deputy Prime Minister Alexander Novak told Russia’s RIA state news agency that “OPEC+ producers are not considering delaying” Currently OPEC+ is holding back 2.2 million barrels per day, the current plan is to gradually add 120,000 b/d starting in April. In total the 2.2 million b/d cut is just a fraction of the total 5.85 million b/d cut the Cartel has been withholding since 2022, which is about 5.7% of global supply. On the topic of Russian oil and OPEC+ Goldman Sachs says “We believe that Russia crude oil production is constrained by its OPEC+ 9.0 million barrels per day (mbpd) production target rather than current sanctions, which are affecting the destination but not the volume of oil exports,”
In other OPEC+ news, Brazil, the seventh-largest oil producer in the world, which produces about 4.3 million barrels per day accounting for about 4% of global production (according to the EIA), was approved by Brazil’s government to join OPEC+. It is being said that Brazil will not face any binding production cuts.
The S&P, Dow Jones and Nasdaq indexes finished lower, while the U.S. Dollar Index closed lower by -0.73%. China’s Shanghai 300 Index declined -0.29%.
Price Thoughts – Crude managed to trade up to its $73 high’s (a monthly high) even after the EIA showed another week of inventory builds, before giving back on half of its gains later in today’s session. Short term, that $73 figure has been our resistance since 2/5, in my opinion, and $70 has held as our floor. Other than today’s EIA, nothing much newsworthy has changed the picture all that much since Tuesday. We did settle above our 5-20-50-100 day moving averages.
There has been support near $70 (which held again week after being tested), below that $67.50 and below that $65 has been a major support figure over the last year.To the upside there’s resistance near $74.50 and the upper $79.50 region. Longer term I think we are still leaning more into the $65-$80 range rather than the $70-$85 range for 2025 for WTI.
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Jim Rinaudo
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