Crude Oil Futures Rebound on EIA Report and Technical Support

WTI Crude Oil futures posted a solid rally yesterday, regaining about half of Tuesday’s move lower. The bullish price action can be attributed to technical support, a bullish EIA

Yesterday’s EIA report tilted bullish. The EIA figures were as follows [thousand barrels]:

Crude Oil: -2,392 vs -2,000 estimate
Gasoline: -1,236 vs -1,600 estimate
Distillate: -1,786 vs +500 estimate
Refinery Utilization:-2.00% vs -0.40% estimate
Draws across all three categories gave the report a bullish tilt while Diesel demand continued to outperform.

Overnight, the Russian-Ukrainian conflict heated up with Ukraine striking a major Russian refinery and Russia striking Ukraine. As we talked about last week after the peace summits, the West’s plans for security guarantees and troops in Ukraine would be a non-starter for Putin.

With the India pressure still in the works, the EU is now considering similar secondary sanctions on third-party buyers of Russian oil. Catalysts are stacking up bullish again.

Technical Analysis:

Our key yesterday was a settlement and scaled buying above 63.40***. With that coming to fruition, our lean is increasingly bullish. Fundamentals and technicals are starting to support the odds of a run higher in crude.

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