The April WTI (CLJ25) trading session settled at 67.18 (+0.63) [+0.95%], a high of 67.48, a low of 66.59. Cash price is at 66.56 (-1.15), while open interest for CLJ25 is 134,432. CLJ25 settled above its 5 day (66.74), below its 20 day (68.80), below its 50 day (71.40), below its 100 day (70.04), below its 200 day (70.99) and below its year-to date (71.40) moving averages. The COT report (Futures and Options Summary) as of 3/11/25 showed commercials with a net short position of -212,629 (a decrease in short positions by 2,801 from the previous week) and non-commercials who are net long +194,324 (a increase in long positions by 10,102 from the previous week)
June’25 Brent Crude contract settled at 70.06 (+0.66) [+0.95%]
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The Trump Administration allowed the “General License 8,” which permitted U.S. dollar payments for energy to multiple Russian banks, to expire yesterday. Yesterday, Russian President Vladimir Putin announced that Russia is in principle aligned with the U.S.-led ceasefire plan endorsed by Ukraine earlier this week. However, he refrained from fully committing to the deal, stressing that additional negotiations are required and that the plan must ensure “lasting peace.” Putin also proposed that if the U.S. and Russia reached an energy cooperation agreement, Russia could provide a gas pipeline to Europe, which could help reduce energy prices across the continent, as reported by Reuters. Data analytics firm Kpler said India is set to import 1.54 million barrels per day of Russian crude oil this month, an increase from the average of 1.1 million bdp it has averaged over the past three months. Indian officials said they will continue to purchase Russian crude if it is sold below the $60 per barrel price cap on non-sanctioned oil tankers. Reuters also reported that Russian crude flows in the four weeks to March 9th increased by 300,000 barrels per day, which was the largest four week gain since January 2023.
Bloomberg reported that Chinese government officials will hold a press conference on Monday where it is rumored officials will announce new measures aimed at boosting the economy. Meanwhile, Reuters, citing trade sources, stated that Chinese oil companies have scaled back purchases of Russian crude oil following the latest round of U.S. sanctions on Russia. A new refinery in China, Shandong Yulong Petrochemical, is set to begin partial operations by the end of March, potentially boosting Chinese crude imports. The refinery is expected to process 200,000 barrels per day, according to Reuters sources with knowledge of the refiner’s operation. The Washington Post reported that China and the Trump Administration have discussed a potential summit between the two nations in June. China’s Shanghai 300 Index had a strong +2.43% gain today.
On Thursday the U.S. Treasury placed new sanctions on Iran’s oil minister Mohsen Paknejad, as well as “shadow fleet” oil tankers accused of exporting crude oil into China.
In the EIA’s monthly short-term energy outlook report the group said “Significant uncertainty remains in our price forecast. The impact of existing sanctions on Russia and recently announced sanctions on Iran, as well as the revocation of licenses for Venezuela oil exports, have increased oil price volatility in recent weeks while markets and trade patterns adjust. Additionally, the extent to which OPEC+ adheres to announced production increases will be a key factor for oil prices in the coming months” and “Global oil markets will remain relatively tight through the middle of 2025 before gradually shifting to oil inventory builds later this year. We expect global oil inventories will fall in the second quarter of 2025 (2Q25) in part due to decreasing crude oil production in Iran and Venezuela.” The EIA believes U.S. crude oil production is on pace to set a record this year, with an average of 13.61 million barrels per day.
The International Energy Agency said in their monthly short-term energy outlook that they expect global oil demand to rise by +1.03 million barrels per day in 2025, a decrease of 70,000 bpd from last month’s report.
This week’s U.S. Energy Information Administration (EIA) weekly report showed U.S. commercial crude oil inventories increased by +1.448 million barrels over the previous week, against a forecast of a +2mb build,U.S. oil inventories are about 5% lower than their five year seasonal average. U.S. crude oil imports averaged 5.5 million barrels per day last week, a decrease of -343,000 barrels per day from the previous week’s report. U.S. oil refinery inputs averaged 15.7 million barrels per day last week, a +321,000 bpd increase from the previous week’s report. Refineries operated at 86.5% capacity last week U.S. gasoline inventories had a large draw of -5.7 million barrels, outperforming a forecast of a -1.9 million barrel draw. Total commercial petroleum inventories decreased by -6 million barrels last week.
Today’s Baker Hughes weekly rig count showed the number of U.S. oil rigs increased by +1, to a total of 487, year over year it is -23 rigs lower. Canada’s oil rigs declined by -31, to a total of 139.
The Dow, S&P and Nasdaq all closed higher. The Dollar Index closed lower by -0.09%, settling at 103.74.
Price Thoughts – Both Brent and WTI settled above our short term key resistance points, $70 for Brent and $67 for WTI. The May contract gained on the April for open interest in WTI, and we saw specs increase long positions in todays COT report. Monday will be interesting to see if we can sustain above $67 and $70 respectively, or trade back into our short-term range of $65-$67, as with most weeks lately, I expect the market will trade the headlines and the API/EIA reports.
$65 has been a major support figure over the last year. To the upside there’s still resistance in the $67 handle, above that $70, above that $74.50. Longer term I think we are still leaning more into the $65-$75 range rather than the $70-$80 range for 2025 for WTI.
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Jim Rinaudo
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