Another oil rally fails as crude stumbles lower
Crude can't seem to break out
I've been watching the July high of $42.40 as the make-or-break line for crude for a week. It has now broke above three times but failed to close above it.
All thee reversals have been substantial but without any real follow-through on the downside.
We will get API storage data later today and US official data Wednesday. Those are the next events to watch but my larger focus is on OPEC.
US producers are bringing supply back online and OPEC is holding onto cuts. That's not going to be able to last. There are producers desperate for those revenues like Nigeria that can't afford to subsidize American shale.
At the close, oil is down 30-cents to $41.66 after reaching a high of $42.94.
Update: Nigeria is trying to play games to overproduce.