May WTI crude fell into negative territory for the first time earlier this week registering its largest one day fall due to refiners cutting runs and cushing storage approaching full capacity. This led to carryover into the June contract which will likely be impacted by storage concerns but also any impending demand signals. White House Economic Adviser Larry Kudlow stated on Monday that May will be a difficult month for the U.S. economy with oil so closely correlated to jobs and GDP growth. Recent reports that Asia’s crude oil storage increased 18 million barrels over the last week bringing capacity to the highest levels since 2016. Regarding supply side developments, India and China have both reported a decline in crude production for the month of March. Notwithstanding the demand fallout are reports that the White House has instructed the destruction of any Iranian vessels that threaten the U.S. The market remains bearish trend with today’s range seen between 19.67 – 10.29.

Crude Oil Jun ’20 Daily Chart
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Alexander Turro

Senior Market Strategist
Alex began his career with an IB at the Chicago Board of Trade after graduating with a BA/BS from Indiana University. He then went on to work for a proprietary trading software company before joining RJO Futures as a Market Strategist.
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