Crude climbs 3.15%
WTI crude is up $1.46 to $47.80 today and has broken above the July high set last week.
A major catalyst for today's jump was commentary yesterday from Haliburton that drillers were "tapping the brakes". Anadarko also said it was cutting spending.
That contrasts with headlines out of Libya that they are attempting to increase production.
With today's breakout, the bulls have reason to be optimistic but don't get too excited. The 100-day moving average is just above at $48.07 and the bulls won't be in charge until that gives way.
If the 100-dma gives way, the next level in play will be the 200-dma but with the series of higher highs and higher lows that's beginning to unfold, the prospects for crude are improving.
On oil, here's a thought to note:
"Hedge funds are still holding large bearish bets against oil and OPEC, yet out in the real world traders and refiners buying and selling actual barrels say it's starting to look somewhat more bullish. "The market is looking a bit better," Ian Taylor, chief executive officer of Vitol Group, the world's largest oil trader, told Bloomberg. "Physical differentials are improving across the world." Differentials are an important indicator of the state of the market. They reflect the price of each type of crude compared with a benchmark, often Brent or West Texas Intermediate. The narrower the discount -- or larger the premium -- the stronger the market for that particular grade."
Also note the seasonals in crude.
