- Crude oil futures fell for a third straight session as market watchers judged the closure of Saudi Arabia's East-West pipeline less severe for supply than originally feared.
- The EIA forecasts WTI crude dropping from $107 to $73 by spring, a decline the roll-yield methodology of the Invesco DB Oil Fund (DBO) cannot fully offset even after its 108% year-to-date gain.
- Energy company insiders are buying shares into the oil pullback, implying a belief that energy equities go higher from here.
Quotes
“Crude oil futures extended declines to a third consecutive session Friday, as market watchers believed the closure of Saudi Arabia's East-West pipeline may have a less severe impact on supply than originally feared.”
“However, DBO faces its biggest challenge as the EIA forecasts WTI crude to drop from $107 to $73 by spring, a decline that its roll methodology cannot fully offset”
“The implication is a belief among insiders that the stocks are going higher from here, not lower.”
Sources
- A sudden end to the Iran war would strike a blow against oil prices and energy stocks. Yet company insiders are buying.MarketWatch
- Oil falls for third straight day as Saudi supply disruptions look less severe than fearedSeekingalpha
- The Oil Fund Beating USO by Harvesting Roll Yield Faces Its Biggest Test Yet