The April WTI (CLJ25) trading session settled at 66.55 (-1.13) [-1.67%], a high of 67.94, a low of 66.37. Cash price is at 67.71 (+1.43), while open interest for CLJ25 is 207,933. CLJ25 settled below its 5 day (66.72), below its 20 day (69.00), below its 50 day (71.48), below its 100 day (70.05), below its 200 day (71.03) and below its year-to date (71.49) moving averages. The COT report (Futures and Options Summary) as of 3/4/25 showed commercials with a net short position of -209,828 (a decrease in short positions by +13,731 from the previous week) and non-commercials who are net long +184,222 (a decrease in long positions by -12,701 from the previous week)

June’25 Brent Crude contract settled at 69.40 (-1.05) [-1.49%] 

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Yesterday’s U.S. Energy Information Administration (EIA) weekly report showed U.S. commercial crude oil inventories increased by +1.448 million barrels over the previous week, against a forecast of a +2mb build,U.S. oil inventories are about 5% lower than their five year seasonal average. U.S. crude oil imports averaged 5.5 million barrels per day last week, a decrease of -343,000 barrels per day from the previous week’s report. U.S. oil refinery inputs averaged 15.7 million barrels per day last week, a +321,000 bpd increase from the previous week’s report. Refineries operated at 86.5% capacity last week U.S. gasoline inventories had a large draw of -5.7 million barrels, outperforming a forecast of a -1.9 million barrel draw. Total commercial petroleum inventories decreased by -6 million barrels last week. 

Russian President Vladimir Putin announced that Russia is in principle aligned with the U.S.-led ceasefire plan endorsed by Ukraine earlier this week. However, he refrained from fully committing to the deal, stressing that additional negotiations are required and that the plan must ensure "lasting peace." Putin also proposed that if the U.S. and Russia reached an energy cooperation agreement, Russia could provide a gas pipeline to Europe, which could help reduce energy prices across the continent, as reported by Reuters. Reuters also reported that Russian crude flows in the four weeks to March 9th increased by 300,000 barrels per day, which was the largest four week gain since January 2023.

Reuters reported that data analytics firm Kpler said India is set to import 1.54 million barrels per day of Russian crude oil this month, an increase from the average of 1.1 million bdp it has averaged over the past three months. Indian officials said they will continue to purchase Russian crude if it is sold below the $60 per barrel price cap on non-sanctioned oil tankers.

OPEC released new February data showing the Cartel had a +363,000 barrels per day increase in production. OPEC kept its 2025 global oil demand growth forecast unchanged (+1.45 million barrels per day, total oil demand 105.2 million barrels per day) Last week OPEC officials confirmed that their April oil output increase would go on as scheduled, although they added that the return could be flexible, saying “Accordingly, this gradual increase may be paused or reversed subject to market conditions. This flexibility will allow the group to continue to support oil market stability.” Currently OPEC is holding back 2.2 million barrels per day, the current plan is to gradually add 138,000 b/d starting in April. 

In the EIA’s monthly short-term energy outlook report the group said “Significant uncertainty remains in our price forecast. The impact of existing sanctions on Russia and recently announced sanctions on Iran, as well as the revocation of licenses for Venezuela oil exports, have increased oil price volatility in recent weeks while markets and trade patterns adjust. Additionally, the extent to which OPEC+ adheres to announced production increases will be a key factor for oil prices in the coming months” and “Global oil markets will remain relatively tight through the middle of 2025 before gradually shifting to oil inventory builds later this year. We expect global oil inventories will fall in the second quarter of 2025 (2Q25) in part due to decreasing crude oil production in Iran and Venezuela.” The EIA believes U.S. crude oil production is on pace to set a record this year, with an average of 13.61 million barrels per day. 

The International Energy Agency released their monthly short-term energy outlook, the IEA expects global oil demand to rise by +1.03 million barrels per day in 2025, a decrease of 70,000 bpd from last month’s report. 

Canada’s Alberta Premier Danielle Smith said she would support a new U.S.-Canada oil pipeline, with a capacity to increase upwards of 2 million barrels per day of additional Canadian exports into the U.S. “Global oil demand is under pressure from the escalating trade war at the same time that OPEC+ is reviving output, threatening to deepen a supply surplus”  and “The United States is currently producing at record highs and is forecast to be the largest source of supply growth in 2025,” the IEA said. 

The American Petroleum Institute announced that U.S. oil executives will meet with President Trump at the White House next week. 

A new refinery in China, Shandong Yulong Petrochemical, is set to begin partial operations by the end of March, potentially boosting Chinese crude imports. The refinery is expected to process 200,000 barrels per day, according to Reuters sources with knowledge of the refiner's operation. The Washington Post reported that China and the Trump Administration have discussed a potential summit between the two nations in June. China’s Shanghai 300 Index declined -0.40% today.

Yesterday’s Consumer Price Index came in lower than forecasted, increasing by +0.2% in February, the smallest increase since October 2024 and below January’s +0.5% growth. Today’s Headline Consumer Price Index rose 2.8% in February, below a forecast of 2.9% and below January’s 3.0%. The Dow, S&P and Nasdaq all closed lower, with the S&P and Nasdaq indexes officially entering correction territory. The Dollar Index closed higher by +0.24%, settling at 103.86. 

Last Friday’s Baker Hughes Rig Count showed oil rigs staying the same as the prior week, year-over-year oil rigs are down 18. 

Price Thoughts - Crude settled broke below $67 after settling above its short term resistance of $67 yesterday, for now it appears we will continue to trade in the $65-$67 range WTI has been trading in over the past week. The debate continues over the impact of Trump’s tariffs and recession fears. Last week set the seventh consecutive weekly loss for WTI, which is the longest streak since November 2023.

$65 has been a major support figure over the last year.  To the upside there’s still resistance in the $67 handle, above that $70, above that $74.50.  Longer term I think we are still leaning more into the $65-$75 range rather than the $70-$80 range for 2025 for WTI. 

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Jim Rinaudo

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