{"id":30122,"date":"2018-01-25T07:07:21","date_gmt":"2018-01-25T12:07:21","guid":{"rendered":"http:\/\/olduvai.ca\/?p=30122"},"modified":"2018-01-25T07:07:21","modified_gmt":"2018-01-25T12:07:21","slug":"why-oil-prices-could-dive","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=30122","title":{"rendered":"Why Oil Prices Could Dive"},"content":{"rendered":"

Why Oil Prices Could Dive<\/a><\/h3>\n\"Rosneft<\/picture>\n
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WTI briefly touched $65 per barrel<\/a> after the EIA reported a surprise drawdown in inventories \u2014 the highest price since late 2014. Although the rally hit some stumbling blocks in recent days, prices remain at multi-year highs. However, absent further bullish news, the downside risk looms large.<\/p>\n

One of the most acute threats to prices is the exorbitant positioning by hedge funds and other money managers, who have staked out record net longs in the oil futures market. With everyone piling into one side of the bet, there\u2019s little room left on the upside. This kind of lopsided positioning has consistently ended with a rush for the exits, setting off a sudden \u2014 and often sharp \u2014 price correction.<\/p>\n

Mad Money\u2019s Jim Cramer spoke about the problem on Tuesday on CNBC<\/a>. \u201cAs of last week, large speculators were holding the single largest bullish position in the history of crude oil,\u201d he said. \u201cBeing bullish is NOT a good sign \u2026 when everyone\u2019s bullish, well, then, you don\u2019t have anyone to convert to be able to start buying \u2026 You need to convert bears but there\u2019s no bears.\u201d<\/p>\n

Cramer, citing data from Carley Garner, co-founder of DeCarley Trading, said the current makeup in the futures market points to a near-term price correction. “As Garner points out, when one of these massive speculative bets in oil unwinds, you do not want to get caught anywhere near the blast radius,” Cramer said.<\/p>\n

Another force working against the current rally is the recent decline of the dollar, which has been weakening for the last several weeks. Since oil is denominated in U.S. dollars, a weaker dollar can put upward pressure on crude prices as crude becomes relatively less expensive to much of the world.<\/p>\n

…click on the above link to read the rest of the article…<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Why Oil Prices Could Dive WTI briefly touched $65 per barrel after the EIA reported a surprise drawdown in inventories \u2014 the highest price since late 2014. Although the rally hit some stumbling blocks in recent days, prices remain at multi-year highs. However, absent further bullish news, the downside risk looms large. One of the […]<\/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":[184,251,6010,6986,592,5332],"class_list":["post-30122","post","type-post","status-publish","format-standard","hentry","category-energy-2","tag-crude-oil","tag-eia","tag-nick-cunningham","tag-oil-inventories","tag-oil-price","tag-oilprice-com"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/30122","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=30122"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/30122\/revisions"}],"predecessor-version":[{"id":30123,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/30122\/revisions\/30123"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=30122"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=30122"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=30122"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}