I wrote some strange data that’s weighing heavily on the oil market today and ZeroHedge picked it up. Big thanks to them and hopefully it gets us closer to an answer on where real gasoline demand is.
In any case, the market certainly isn’t convinced that the data is bad because crude was down another $2.12 to $88.54 per barrel today. That’s the lowest since Feb 2. The year opened at $78 so oil is now only up $10 year-to-date.
Natural gas is a different story with huge gains this year. Today, weekly inventories rose 41 bcf compared to 29 bcf expected. That briefly sparked a larger selloff but it was most recently down just 8 cents to $8.18.
Technically, the break of the multiple bottoms since Feb is bearish and the measured target of that move is in the $50s, which is really tough to believe given the supply situation. It’s the kind of thing that would point to a horrible global recession. Moreover, if we were to get those prices again, it would cement producer discipline for years to come, leading to a spike later.
Before that, the Dec highs near $85 are support and then the November omicron low of $62.90.
/crude oil