Friday October 7, 2016
Front month WTI traded to and settled above $50 for the first time in more than two months on Thursday, continuing the market's momentum that began after last week's special OPEC summit in Algeria. A couple of bullish inventory summaries have also added fuel (pun intended) to the fervor, and even some stiff resistance just below $50 (seen on Wednesday) could not prevent a push through this figure.
Though WTI is now at its multi-month high, even more startling is that the front month Heating Oil contract (up a little more than a penny on Thursday) is now at its highest level in exactly one year. Strong harvest demand has given additional strength to that product.
November WTI didn't need much to break above $50 (settling just below it on Wednesday) and early Thursday we saw that break. The market didn't immediately run after the breakthrough, but it didn't fall back, either. Rather, the price action of the day was relatively muted, and WTI stayed in a dollar range through. For the day, WTI was up 61-cents and settled at $50.44. Oil is up six dollars since the OPEC summit last week. Heating Oil is up 18-cents in the same period. RBOB managed a small gain, less than a penny, and any supply worries (ex-Florida) from Matthew seem to have fully abated.
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