Energy Futures Struggle To Find Direction

Energy futures continue to struggle to find direction, starting the week with more apprehensive gains. After 2 months of consistent selling, the complex has been moving sideways for 3 weeks now.
Prices have been unable to hold below the $50 & $60 marks for WTI and Brent respectively, but also unable to sustain a rally, even following the latest output cut announcement from OPEC & Russia. Here’s why at least one person thinks that 2019 will continue with the unpredictable pattern.
Baker Hughes reported another decline in drilling rigs last week, with the total oil count dropping by 4, reaching its lowest level in 8 weeks. With WTI in Midland trading down to the low $40s last week, we could be in for more rig reductions in 2019 if prices don’t stabilize soon.
Money managers were a mixed bag last week, reducing their net length held in WTI and ULSD contracts, while showing increases in both RBOB and Brent. The net positions also changed for different reasons, as new length in Brent outpaced another increase in short positions (which are now approaching an 18 month high) while gasoline saw reduced length offset a reduction in short bets.
In 2018 we saw the speculative class of trader shift from record net-length as prices were rising early in the year, to below-average positions now. How they behave in 2019 may determine whether or not prices have put in a floor.
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Crude Steady While RBOB Leads Gains Amid OPEC Demand Downgrade

Low Pressure Storm System Could Disrupt Gulf Refining Due To Potential Flooding
