Oil prices have rallied since mid-February and are now back into the price range established last autumn.
Oil Prices and Inventories
Inventory levels remain elevated but should begin their seasonal decline later this month. In fact, working commercial storage hit an all-time high in April, exceeding the levels reached during the Great Depression. Although there were concerns that prices could plummet once the Department of Energy’s (DOE) estimate of working storage was exceeded, at 502 mb, it has become clear that there was ample storage available. Thus, worries about a decline into the low $20s per barrel did not occur.
These reports were prepared by Confluence Investment Management LLC and reflect the current opinion of the authors. Opinions expressed are current as of the date shown and are based upon sources and data believed to be accurate and reliable. Opinions and forward-looking statements expressed are subject to change. This is not a solicitation or an offer to buy or sell any security. Past performance is no guarantee of future results. Information provided in this report is for educational and illustrative purposes only and should not be construed as individualized investment advice or a recommendation. Investments or strategies discussed may not be suitable for all investors. Investors must make their own decisions based on their specific investment objectives and financial circumstances.