Leading crude production to 21-month highs, the number of US oil rigs rose (Up 11 to 733) for the 20th straight week to its highest since April 2015.
- *U.S. OIL RIG COUNT UP 11 TO 733 , BAKER HUGHES SAYS :BHI US
Lower 48 production continues to rise… to the highest in 21 months…
With Permian leading the way…
And given the lag to the surge in rig counts, Rystad Energy says U.S. crude production will exceed 10 million barrels a day before year-end, echoing sentiment from other analysts.
Which helps explain the post-OPEC-Deal drop…
And while prices keep falling, oil permabulls keep pushing… As Bloomberg reports, contrary to the “sea of negative sentiment" in crude markets, global inventories should fall at a higher pace in the second half of 2017,Astenbeck Capital Management LLC’s Andy Hall says in latest investor letter. U.S. inventories continue to drop and EIA data suggest production gains have been slower than initially estimated, Hall says in letter obtained by Bloomberg News. OPEC’s extension of supply cuts will focus on exports this time, not just production, and thus drive down stockpiles in areas that drive the market.
“Inventories will fall at an accelerating rate over the balance of the year even with continued strong growth in U.S. oil production," Hall writes.
“The unprecedented cooperation between Saudi Arabia and Russia to ‘do whatever it takes’ should not be underestimated."
He may be right this time… or not, but what's another margin call between friends?
via http://ift.tt/2rzYlGJ Tyler Durden