Hello and welcome to our blog (and our very first blogpost)!
We will in this blog track the price of a WTI Crude oil future contract called: "CLM4", which has a maturity date in June 2024. In this blog we will do our best to cover; Market developments, any relevant news (or events) that might impact the price.
Once again, thank you for taking the time to read our thoughts and we hope that you find the blog interesting!
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As we look at the WTI Crude Oil price today (CLM4 (June 2024, future contract)), we see that price has gone up gone up 8,93% YTD. It has gone up significantly in the first 7/52 weeks of the year as graph below shows.
We can see from the graph that previously (from 18th.jan to 01.February) we had a increase in the futures contract. It went from $72,82, to $77,59 (where it peaked) and decreased back to $72,33.
Then, suddenly we saw a significant increase in the price from $72 to back to $77. This clearly identifies that the market is very volatile and large fluctuation is cautioned for. But this also identifies a similarity. The commodity "peaked" from a "YTD" view. Thus indicating that we might therefore be in for a short-term market correction in the next upcoming months (or weeks).
At this point in time, we should definitely be cautious and follow the commodity closely, since there is a high probability that the price might drop. However, it could also establish a new "high" breaching the psychology barrier of $80, which might drive the price even further.
It also important to keep in mind, that the underlying asset price is trading a $79,19 today while the future contract price (CLM4) is trading at $77,28. This reinforces the probability that we are facing a backwardation and a price decrease might be upon us soon.
A report from EIA also state that the US crude oil inventory increased by 12 million barrels last week, but are 2% below the 5 year average. Where the amount of barrels in the inventories are at 439,5 million. If this trend continues we might be in for a bumpy ride!
We will continue to monitor the market and update the blog with any relevant news that we think might impact the underlying asset.
Thanks for reading!
At this point in time, we should definitely be cautious and follow the commodity closely, since there is a high probability that the price might drop. However, it could also establish a new "high" breaching the psychology barrier of $80, which might drive the price even further.
It also important to keep in mind, that the underlying asset price is trading a $79,19 today while the future contract price (CLM4) is trading at $77,28. This reinforces the probability that we are facing a backwardation and a price decrease might be upon us soon.
A report from EIA also state that the US crude oil inventory increased by 12 million barrels last week, but are 2% below the 5 year average. Where the amount of barrels in the inventories are at 439,5 million. If this trend continues we might be in for a bumpy ride!
We will continue to monitor the market and update the blog with any relevant news that we think might impact the underlying asset.
Thanks for reading!
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