{"id":26540,"date":"2017-10-07T10:20:48","date_gmt":"2017-10-07T15:20:48","guid":{"rendered":"http:\/\/olduvai.ca\/?p=26540"},"modified":"2017-10-07T10:20:48","modified_gmt":"2017-10-07T15:20:48","slug":"oil-back-below-50-end-of-inflationary-jump","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=26540","title":{"rendered":"Oil Back Below $50: End of Inflationary\u00a0Jump?"},"content":{"rendered":"
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Oil Back Below $50: End of Inflationary\u00a0Jump?<\/a>\u00a0<\/span><\/h3>\n<\/header>\n
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Crude\u00a0oil is back below $50 and production is up. Hedge funds are reducing positions. Is this the end of an inflationary jump?
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\nCrude Weekly Chart<\/strong><\/p>\n

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Oil\u2019s Stint Above $50 Ends<\/strong><\/p>\n

Bloomberg reports Oil\u2019s Stint Above $50 Ends<\/a>.<\/p>\n

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I do not know where Bloomberg got that caption from. Crude is not at its lowest price since December 20003. I show crude at $2605 in January of 2016.<\/p>\n

I show crude at $26.05 in January of 2016.<\/p>\n

Hedge Funds Pare Positions as Stockpiles Soar<\/strong><\/p>\n

It doesn\u2019t help that U.S. crude stockpiles remain above their five-year average by more than 70 million barrels at a time when refineries are starting to shut for maintenance. Meanwhile, the top American shale plays, led by the Permian and Eagle Ford basins in Texas, are set to produce a record amount of crude this month.<\/p>\n

Hedge funds reduced their WTI net-long position \u2014 the difference between bets on a price increase and wagers on a drop \u2014 1 percent to 249,323 futures and options in the week ended Oct. 3, U.S. Commodity Futures Trading Commission data show.<\/p>\n

As for Brent, the net-long position on the global benchmark declined 0.9 percent to 504,263 contracts, after reaching an all-time high the previous week, according to data from ICE Futures Europe.<\/p>\n

\u201cOil\u2019s had a heck of a run for the month of September,\u201d Thummel said. \u201cThe continued concerns in the market that keeps the shorts active: Is OPEC compliance waning? Will their compliance start to be less? Will they start to cheat more?\u201d<\/p><\/blockquote>\n

Crude Monthly Chart<\/strong><\/p>\n

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CPI Energy<\/strong><\/p>\n

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Year-over-year the CPI energy index is up nearly 12%. Although it\u2019s October, the latest CPI is for August.<\/p>\n

End of Inflationary Jump?<\/strong><\/p>\n

I don\u2019t know if this is the end of the move over $50 or not, but fundamentals are poor just as hedge funds plowed into crude futures.<\/p>\n

A move back towards $40 seems likely.<\/p>\n

If so, inflation pressures may be peaking to the consternation of the Fed.<\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Oil Back Below $50: End of Inflationary\u00a0Jump?\u00a0 Crude\u00a0oil is back below $50 and production is up. Hedge funds are reducing positions. Is this the end of an inflationary jump? Crude Weekly Chart Oil\u2019s Stint Above $50 Ends Bloomberg reports Oil\u2019s Stint Above $50 Ends. I do not know where Bloomberg got that caption from. Crude […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[3],"tags":[184,14648,13390,588,592],"class_list":["post-26540","post","type-post","status-publish","format-standard","hentry","category-energy-2","tag-crude-oil","tag-michael-shedlock","tag-mishtalk","tag-oil","tag-oil-price"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/26540","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=26540"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/26540\/revisions"}],"predecessor-version":[{"id":26541,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/26540\/revisions\/26541"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=26540"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=26540"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=26540"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}