We still have more oil than we know what to do with. Saudi Arabia just said it would not stop pumping oil to boost prices. And the U.S. Energy Information Administration just reported that crude stockpiles grew by 2.8 million barrels last week well above expectations for 2.5 million.
Apparently, investors are still ignoring that information.
Sure, after seven weeks of significant inventory builds, we saw a draw of 482,000 barrels. But what investors are missing is the weekly build of 1.5 million barrels in Cushing.
And before investors can argue that new global conflict may be a boon to oil prices, think again. No matter how close we get to a bigger war scenario, the global community is still overflowing with more oil than it knows what to do with. And Iranian supply is supposedly coming online in the first quarter of 2016.
Since oil peaked at $50.51 in October 2015, it’s pulled back 19%...
Don’t follow them, the insiders, or any bullish news from OPEC into oil.
There’s no bottom in sight.