Drain the tanks
Inventories low with caution
In this report: Production shifts and inventories, Hedge fund positioning, Russian oil exports and revenue, Nat Gas repricing potential impacts, German elections and oil trade charts.
Articles
IEA on A.I energy demands
China kills energy trade with the US, but initial impact is limited
Why upstream companies might break their capital discipline rules
Macro
Production & Inventory Shifts
With the most productive drilling sites already developed, the industry is prioritizing inventory expansion over production increases. This presents a headwind to Trump’s "drill, baby, drill" approach, which emphasizes boosting output
OPEC's Dilemma
The cartel faces a strategic bind:
Increase production, which would lower oil prices.
Hold steady, risking a decline in market share to non-OPEC producers.
Brent vs. WTI Divergence
China’s tariffs on U.S. crude have prompted hedge funds to rotate out of WTI, widening the Brent-WTI spread to over $3.30 per barrel since mid-January.
Cushing stockpiles are at critically low levels, making WTI more vulnerable to market shocks notwithstanding Chinese counter tariffs of 10% on US Oil./ 15% on US LNG. Tell me again how inflation is not on the way?
Source: John Kemp
