Poten’s Crude Oil Highlights

17 Jun 2015: US oil statistical trends were mostly bullish for oil prices this week, with another drop in US oil inventories, fewer operating oil-drilling rigs and a softer US Dollar.  However, once again the oil production in the US continued to rise.  Oil production climbed to another new recent year high, despite the drop in the number of active drill rigs. US crude production rose 24 thousand barrels a day in the latest weekly EIA report, reaching another new recent high of 9.610 million barrels a day.  US crude inventories dropped for a sixth consecutive week.  Crude oil inventories were at 470.6 million barrels, which is down 6.8 million barrels (excluding the Strategic Petroleum Reserve). Fewer active crude oil drilling rigs were again reported for the US.  The number of active crude oil drilling rigs in the US was down to 635.  That was seven rigs below the previous week count.  Active oilrigs have now declined 27 weeks in a row. Crude oil markets firmed modestly this week for key benchmark grades.   Prices for July West Texas Intermediate (WTI) crude at Cushing, Oklahoma ended the week at $59.96 a barrel, up $0.83 a barrel versus the previous week.  The US Dollar was generally softer this week.  (A weak Dollar is directionally bullish for oil prices, which are denominated in US Dollars.) July Brent prices closed at $63.87 a barrel, up $0.56 a barrel versus the previous Friday close.  The Brent price premium over WTI for July crude narrowed for a fourth straight week, going to just under $4 a barrel. Western Canadian Select crude (WCS) prices firmed slightly this week.  July WCS prices rose to almost $52.50 a barrel FOB Alberta this week.  WCS prices for July were $7.50 a barrel under July WTI.  Forest fires in northern Alberta have been mostly brought under control and oil production has reportedly restarted at most affected tar sands locations.