We've been calling for WTI $90 for a couple months but the annualized rate of return is starting to look mediocre.
Okay, up a quarter isn't all that enthusiastic.
From Futures Magazine:
It is jobs Tuesday, but will the oil market (NYMEX:CLX13) care? Not only will this data be viewed as outdated and subject to revision, oil, as I have said before, is disconnecting from the day to day risk-off and risk-on scenarios. Oh sure, the general feel on the outlook of the economy will always influence the price of oil. Economic figures, like the jobs report, are an indicator that oil traders will look to try to gage demand. Yet oil is finding its own way as geopolitical risk premium is coming out and supply continues to rise. Unless you get a shockingly good or bad number, the market may only give it passing credence.
The other factor is supply and the spread between the Brent and Wit spread that is back above $10. Labor troubles and seasonal maintenance as well as the slow return of Libyan and Nigerian oil are helping the spread. The Energy Information Administration also played a part by reporting that U.S. oil supply increased by almost 4 million barrels last week. On top of that, U.S. exports of products continue to be at records. The heating oil rob spread came back in as weather forecasts started to moderate. As for WTI, the breach of $100 and the close below the 120-day moving average opens up a move back toward $89.00. Look to sell rallies and buy puts and bearish option strategies....MORE