The May WTI (CLK25) contract settled at 71.71 (+0.51) [+0.72%], high of 72.28, low of 70.59. Spot price is 71.22 (-0.25), open interest for CLK25 is 307,027. CLK25 settled above its 5 day (70.83), above its 20 day (68.21), above its 50 day (69.78), above its 100 day (69.77), above its 200 day (70.44) and above its year-to date (70.56) moving averages.
The June Brent Crude (QAM25) contract settled at 74.95 (+0.46) [+0.62%], high of 75.46, low of 73.71. Spot Brent price is 74.49 (-0.29). QAM25 settled above its 5 day (74.14), above its 20 day (71.46), above its 50 day (72.96), above its 100 day (73.03), above its 200 day (74.17) and above its year-to-date (73.66) moving averages.
The latest COT report (Futures and Options Summary) as of 3/28/25 showed commercials with a net short position of -208,888 (a increase in short positions by 3,580 from the previous week) and non-commercials who are net long +197,061 (a increase in long positions by 10,853 from the previous week)
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Today’s weekly U.S. Energy Information Administration data for the week ending March 28th showed U.S. crude oil inventories grew by 6.165 million barrels (against a forecast of a -0.5mb draw). U.S. oil inventories are about 4% below their five-year seasonal average. Total commercial petroleum inventories increased by 5.4 million barrels. U.S. oil refinery inputs averaged 15.6 million barrels per day, a decrease of -192,000 b/d from the prior week, while oil refineries operated at 86% capacity. U.S. crude oil imports averaged 6.5 million barrels per day last week, an increase of +271,000 barrels per day compared to the week prior. Total products supplied over the last four-week period have averaged 20.1 million barrels per day, down -1.2% from the same time last year. The Cushing, Oklahoma hub was reported to have a build of +2.373 million barrels.
President Trump declared a “Liberation Day” for U.S. trade policy as he announced a 10% tariff on all imports, with even higher rates for certain countries. The new tariffs will take effect immediately following the President’s announcement. The U.S. is implementing a 34% tariff on China, 20% on Europe, and 24% on Japan. Canada and Mexico will be temporarily exempt from the standard 10% tariff. This 10% tariff will only be applied if the original 25% duties imposed on Canadian and Mexican imports are either lifted or suspended.
Bloomberg reported, citing tracking data, that global seaborne crude oils increased from the February to March period. Bloomberg estimates that global crude exports averaged 39.92 million barrels per day in March, up by +199,000 barrels per day from February. Canada’s oil flows increased by +190,000 b/d, while Saudi Arabia’s flows fell by -65,000 b/d.
A group of 50 U.S. Senators have drafted a plan to impose a 500% tariff on imported goods from countries who import Russian crude oil, gas and uranium. “These sanctions would be imposed if Russia refuses to engage in good faith negotiations for a lasting peace with Ukraine or initiates another effort, including military invasion, that undermines the sovereignty of Ukraine after peace is negotiated.” the statement said. This morning, Russia and Ukraine accused each other of attacking energy facilities, violating the agreed-upon energy ceasefire. Following the latest attack, President Zelensky urged the U.S. yesterday to impose additional sanctions on Russia. On Sunday, President Trump warned that buyers of Russian oil could face tariffs of 25% to 50%, stating they could be imposed “at any moment.” As told by NBC, Trump said, “If Russia and I are unable to make a deal on stopping the bloodshed in Ukraine, and if I think it was Russia’s fault … I am going to put secondary tariffs on oil, on all oil coming out of Russia.” He added, “If you buy oil from Russia, you can’t do business in the United States. There will be a 25% tariff on all oil, a 25- to 50-point tariff on all oil.” President Trump said he expects to hold another phone conversation with President Putin at some point this week. The U.S. has not imported any Russian crude oil since April 2022, according to EIA data. Meanwhile, India has overtaken China as the largest buyer of Russian crude oil, with Russian oil accounting for about 35% of India’s total crude imports in 2024. Russia produces roughly 9 million barrels per day.
This week the U.S. Energy Information Administration reported that U.S. crude oil demand was at 20.736 million barrels per day in January, up 1.149mbpd (+5.9%) year-over-year. U.S. crude oil production was at 13.146 million barrels per day, lower than this past December’s production by 305,000 barrels per day, and the lowest figure since February 2024.
Kazakhstan has continued to produce crude oil over the OPEC+ mandate level, setting an all-time high in March with 2.17 million barrels per day, despite the current OPEC+ quota of 1.468 million b/d. OPEC+ ministers will hold a joint call tomorrow to discuss said quotas, as the cartel began their production increases this month, adding 138,000 barrels per day, gradually unwinding the 2.2 million barrels per day it cut over the last year.
China’s state-owned energy company CNOOC announced the discovery of a new oil field in the South China Sea, estimated to hold over 100 million tons of crude oil, which measures out to roughly 733 million barrels. China’s Shanghai 300 Index settled at 3,884.39 down -0.08%.
The Dow, S&P and Nasdaq settled about a half a percentage higher during market hours, after President Trump’s Rose Garden tariff announcements the indexes have fallen sharply in the after hours markets. The Dollar Index is trading at 103.74 (-0.49%) as of this post.
Last Friday’s Baker Hughes Rig Count showed U.S. oil rigs dropping by 2, to a total of 484 in the week ending March 28th. The 484 total is 22 less than this time last year. U.S. gas rigs increased by 1, tota total of 103. The 103 total is 9 rigs less than this time last year. In Canada oil rigs declined by 10, to a total of 108.
Price Thoughts – Oil was briefly trading lower before posting about half a percentage point of gains. However, the picture has flipped as futures are trading over 2% lower in the after hours. Tomorrow could set up for a very bearish day, as of this post futures have broken through most of the major moving averages we’ve been trading above for the last week, with WTI trading under $70. It will be interesting to see how we trade for the remainder of the week, and what counter-tariff announcements are made by countries on the receiving end of Liberation Day.
WTI Crude oil has broken above its $67 long-term support line, while Brent has sustained above its $70.00 level. $65 has been a major support figure since 2021, and with the settlements over the past week I believe we have set a new short-term support at the $67 handle (We’ll find out if $70 becomes the new short-term support this week I believe). To the upside, there’s resistance in the upper $69 region into $70 handle (which we settled above today), above that $74.50 for WTI. 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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