On November 28, 2017, the American Petroleum Institute will publish its weekly crude oil inventory report. On November 29, 2017, the U.S. Energy Information Administration will release its crude oil inventory report. OPEC’s meeting will be held on November 30, 2017. On December 1, 2017, Baker Hughes will release its US oil rig count data.
All of these events could drive oil (UWT) (USL) prices this week. US (DTO) (OIL) and Brent (BNO) oil are near a three-year high. Higher oil prices benefit energy producers (XES) (PXI) like Marathon Oil (MRO), Occidental Petroleum (OXY), PDC Energy (PDCE), and Sanchez Energy (SN).
Bullish crude oil price drivers
US crude oil (DWT) (UCO) futures hit $58.95 per barrel on November 24, 2017—the highest level in nearly three years. Oil prices rose due to OPEC’s production cuts, the fall in OECD crude oil inventories, and the supply outage in Libya, Iraq, Nigeria, and Venezuela.
Any fall in US oil inventories and positive announcements related to ongoing productions cuts could benefit oil prices. For more updates on OPEC’s meeting, read Part 2 of this series.
Bearish crude oil price drivers
US crude oil prices hit $26.21 per barrel on February 11, 2017—the lowest level in 13 years. Any rise in US oil production and rigs could pressure oil (SCO) (DBO) prices this week. Any estimates of slowing oil demand in 2017 and 2018 could also pressure oil (BNO) (USL) prices.
Crude oil volatility index
The CBOE Crude Oil Volatility Index (OVX) rose 0.19% to 26.88 on November 24, 2017—a three-week low. The low volatility index suggests that traders are expecting fewer sharp moves in oil prices. OVX was at 51 on November 29, 2016, before OPEC’s meeting in November 2016. Oil prices rose 9.3% after the meeting.
January US crude oil futures are above their 100-day, 50-day, and 20-day moving averages on November 24, 2017. It suggests that crude oil futures could trade higher.
BHP (BHP) has mentioned that China’s demand for high-quality iron ore (XME), as well as new demand from countries such as India, should support overall demand for iron ore.
Hibbett Sports (HIBB) stock surged 22.3% as of 1:54 PM ET today as the company reported impressive results for fiscal 2019's fourth quarter, which ended on February 2.
Wall Street analysts expect a potential upside of 21.63% for Alexion Pharmaceuticals based on the stock's closing price on March 21.
Today, we got another round of dismal data points from Europe (VGK)(EZU). According to a Markit survey, Germany’s (EWG) March PMI Composite Output Index fell to a 69-month low of 51.5.
On March 21, US crude oil’s implied volatility was 24.9%, which was 6.7% below its 15-day average. Usually, lower implied volatility supports oil prices.
The overall cannabis sector took a hit today amid the broader market's declines. The volatility index (VIX) jumped 17.9%, and the cannabis sector is more sensitive than the market.
The tech-heavy NASDAQ Composite Index (QQQ) is on track to post its 12th weekly gain in 13 weeks.