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PowerShares DB Crude Oil Long ETN (OLO)

- NYSEARCA
  • Wed, Mar. 11, 6:55 PM
    • The latest government report showing an increase in already-record crude oil supplies is sparking speculation the market is setting up for a selloff that could take oil prices to a new cycle low.
    • "It says prices are going to remain under pressure," says Andrew Lipow, who expects oil to retest its recent low and head to $40/bbl.
    • "WTI could take another leg down," says Citigroup energy analyst Eric Lee. "If imports into the U.S. don't budge, which they won't... if exports don't rise quickly enough, which is a wild card, then producers at various locations need to shut in pipelines or run at low utilization."
    • Goldman Sachs President Gary Cohn warns that crude could fall to $30 as the industry runs out of storage space; with the winter heating oil season ending, refineries are turning to producing more gasoline for the summer driving season, he says, meaning they will not need crude oil for weeks or months.
    • $30 oil could even have an important impact on the Fed's timeline for raising interest rates; "It's hard to raise interest rates potentially when you see deflationary oil prices," Cohn says.
    • ETFs: USO, OIL, UCO, SCO, BNO, DTO, DBO, UWTI, USL, DWTI, DNO, SZO, OLO, TWTI, OLEM
    | 108 Comments
  • Wed, Mar. 11, 10:31 AM
    | 20 Comments
  • Tue, Mar. 10, 1:51 PM
    • Prices for WTI crude oil (USO -2.9%) are expected to average $52.15 per barrel this year, down from the previously-forecast $55.02. Though also lowering its 2016 outlook, the EIA continues to expect a strong bounce in prices next year - now $70 vs. $71 previously.
    • Capex spending slowdown? U.S. crude oil production is expected to average 9.3M barrels per day this year, and rise to 9.5M in 2016. This country's highest-ever average production was 1970 at 9.6M barrels.
    • WTI crude is lower by 1.7% on the session to $48.35 per barrel.
    • EIA Short-Term Energy Outlook
    • ETFs: USO, OIL, UCO, SCO, BNO, UGA, DTO, DBO, UWTI, USL, DWTI, UHN, DNO, SZO, OLO, TWTI, OLEM
    | 6 Comments
  • Mon, Mar. 9, 7:46 AM
    • "The lack of a meaningful [inventory] build in the past few months leaves risk to our forecast for oil prices remaining at $40 a barrel for two quarters skewed to the upside," says Goldman, citing the weather as helping to keep more crude from coming to market.
    • Alongside the weather, violence, or sanctions-related supply disruptions pulled 885K barrels per day from the market in January and February vs. December, says Goldman. The team isn't necessarily bullish on oil though, and reminds Libyan disruptions are at a peak, normal weather in Iraq could lead to a boost in exports, and Russia, Brazil, Saudi Arabia, and the U.S. could continue to lift production. "Our expectation going forward is therefore for the global crude inventory build to resume."
    • Crude is little-changed in morning action, at $49.81 per barrel.
    • ETFs: USO, OIL, UCO, SCO, BNO, UGA, DTO, DBO, UWTI, USL, DWTI, UHN, DNO, SZO, OLO, TWTI, OLEM
    | 20 Comments
  • Fri, Mar. 6, 5:57 PM
    • Oil drillers expecting prices to rebound have come up with an alternative to storing their crude in tanks: They’re keeping it in the ground, as drillers who have spent millions boring holes through petroleum-rich shale are just waiting for prices to go up before actually turning on the spigot.
    • The backlog of unfracked wells is one reason U.S. crude output is poised to climb even as companies have idled more than a third of the rigs that were drilling for oil in October; Continental Resources' (NYSE:CLR) Harold Hamm says ~85% of U.S. wells aren’t being completed right now.
    • Examples: Anadarko Petroleum (NYSE:APC) says it expects to have as many as 440 uncompleted wells by year's end, EOG started the year with ~200 uncompleted wells and plans to let that inventory build through H1, and Canadian Natural Resources (NYSE:CNQ) says it has 161 uncompleted wells.
    • Initial production from a new well typically is 750-1,000 bbl/day, meaning the "fracklog" could represent as much as 3M bbl/day of new output, at least at the outset - a major reason an oil price recovery will prove to be an extended process, analysts say.
    • ETFs: USO, OIL, UCO, SCO, BNO, DTO, DBO, UWTI, USL, DWTI, DNO, SZO, OLO, TWTI, OLEM
    • Earlier: Oil glut's latest dilemma: where to store it all
    | 60 Comments
  • Fri, Mar. 6, 1:19 PM
    • The U.S. rig count declined by 75 this week to 1,192, picking up the pace from last week's 43 rigs taken out of service, the 13th consecutive week of total decline and the lowest reading since the week ending Dec. 31, 2009, according to the latest survey from Baker Hughes (NYSE:BHI).
    • Drillers idled 64 oil rigs to 922, the lowest number of oil rigs in use since April 2011 and down 43% since October.
    • Per drilling region, the biggest decline came from Texas' Permian shale basin, where 22 rigs were shut down, while 8 Eagle Ford rigs were shut.
    • ETFs: USO, OIL, UCO, SCO, BNO, UGA, DTO, DBO, UWTI, USL, DWTI, UHN, DNO, SZO, OLO, TWTI, OLEM
    | 26 Comments
  • Thu, Mar. 5, 7:23 PM
    • U.S. inventories are at their highest levels in at least 80 years, and the U.S. is running out of places to store it, prompting some analysts to predict already depressed prices could spiral even lower.
    • When storage is full, there is pressure on those holding oil in storage to "dump that inventory,” says the CEO of energy consulting firm Perry Management, who believes the space shortage could cause prices to drop to as low as $30/bbl.
    • U.S. oil production rose for the fourth consecutive week to a rate of 9.3M bbl/day, even as drilling rigs are being idled at a rapid clip; U.S. inventories also rose, for the eighth straight week, jumping 2.4% to 444M barrels, the U.S. Energy Information Administration reports.
    • Producers are pumping nearly 1.5M bbl/day more crude than the world needs, due to a combination of slowing demand and rising production in the U.S., meaning oil put in storage today could be there for years; should the glut worsen, more producers could be forced to shut their wells, effectively storing the oil in the ground.
    • Storage operators at Cushing, Okla., including Plains All American (NYSE:PAA) and Phillips 66 (NYSE:PSX), said recently they expect the tanks there to hit capacity - currently they are about two-thirds full.
    • ETFs: USO, OIL, UCO, SCO, BNO, DTO, DBO, UWTI, USL, DWTI, DNO, SZO, OLO, TWTI, OLEM
    | 57 Comments
  • Thu, Mar. 5, 5:45 AM
    • Expect continued consolidation, volatile at times, with a tendency toward higher oil prices, Mohamed El-Erian says in an op-ed this morning.
    • There will be no quick return to the $100 level.
    • Low-cost producers of oil and energy products will expand their market share.
    • All above bets are off the table if there's a geopolitical shock.
    • ETFs: USO, OIL, UCO, SCO, BNO, DTO, DBO, UWTI, USL, DWTI, DNO, SZO, OLO, OLEM
    | 10 Comments
  • Wed, Mar. 4, 10:31 AM
    | 46 Comments
  • Tue, Mar. 3, 12:08 PM
    • "This is a bad deal. It's a very bad deal. We're better off without it," says Israeli PM Benjamin Netanyahu, speaking before Congress about U.S. negotiations with Iran over its nuclear ambitions. "The alternative to this deal is a much better deal."
    • For now, the clarity of his speech looks to have set back the chance of sanctions being lifted on Iran, and crude oil is more than $1 per barrel higher to $50.25 since the address' 11 ET start.
    • USO +0.95%
    • ETFs: USO, OIL, UCO, SCO, BNO, UGA, DTO, DBO, UWTI, USL, DWTI, UHN, DNO, SZO, OLO, TWTI, OLEM
    | 16 Comments
  • Fri, Feb. 27, 1:21 PM
    • Just 33 U.S. oil rigs were taken out of service this week, bringing the total down to 986, the lowest since summer 2011. The number of oil and gas rigs fell 43 to 1,267 - the lowest since early 2010.
    • For oil traders, that's still too many rigs pumping, and WTI crude slides nearly $1 per barrel on the report, to $48.55 per barrel (it's still up by 0.85% on the session).
    • ETFs: USO, OIL, UCO, SCO, BNO, UGA, DTO, DBO, UWTI, USL, DWTI, UHN, DNO, SZO, OLO, TWTI, OLEM
    | 26 Comments
  • Fri, Feb. 27, 3:53 AM
    • Crude oil futures rebounded today, with Brent heading for its biggest monthly gain since May 2009, as a reduction in rig counts and healthy growth in Chinese demand this year supported prices.
    • China's implied oil demand is set to grow 3% in 2015, announced China National Petroleum this morning, surpassing the International Energy Agency's forecast of 2.5%.
    • Brent prices have risen by around 15% so far this month from January's close of $52.99.
    • Crude futures +2.3%, after dropping 5.5% yesterday.
    • ETFs: USO, OIL, UCO, SCO, BNO, DTO, DBO, UWTI, USL, DWTI, DNO, SZO, OLO, TWTI, OLEM
    | 33 Comments
  • Thu, Feb. 26, 2:48 PM
    | 15 Comments
  • Wed, Feb. 25, 11:04 AM
    • WTI crude (NYSEARCA:USO) knee-jerked down to about $48.50 per barrel after the EIA reported a crude oil inventory build of 8.4M barrels vs. 4M consensus (and 7.7M last week), but the price has since recovered to where it stood prior to the print, -0.3% at $49.13.
    • Gasoline (NYSEARCA:UGA) stocks fell 3.1M barrels  vs. a 1.5M consensus drop and a 500K gain last week. Distillates (NYSEARCA:UHN) fell 2.7M barrels vs. a 3M barrel consensus drop, and a decline of 3.8M last week.
    • ETFs: USO, OIL, UCO, SCO, BNO, DTO, DBO, UWTI, USL, DWTI, DNO, SZO, OLO, TWTI, OLEM
    | 44 Comments
  • Mon, Feb. 23, 2:19 PM
    • Crude oil briefly turned positive following an FT report that OPEC could hold an emergency meeting if prices continue to slide, which would be a sign of the group's growing alarm over the impact of cheaper oil on their economies.
    • The oil minister of OPEC member Nigeria said the group had discussed the prospect of holding a meeting, according to the report.
    • After the brief spike, crude prices have resumed their descent: Brent crude -2% at ~$59 after spiking as high as $60.67, while WTI -2.8% at $49.35 after briefly touched a session high of $50.99.
    • ETFs: USO, OIL, UCO, SCO, BNO, DTO, DBO, UWTI, USL, DWTI, DNO, SZO, OLO, TWTI, OLEM
    | 31 Comments
  • Mon, Feb. 23, 1:00 PM
    • Shale oil producers are cutting output so quickly that U.S. crude production could fall sooner than expected, according to several CEOs who told Reuters they were taken aback by the scale and speed of the cutbacks and that the current oil price downturn is different from previous episodes in their careers.
    • Just a few weeks ago, the prevailing view among industry insiders and analysts was that U.S. oil production would keep rising for several months despite falling rig numbers because of rising productivity of active wells and drilling inertia.
    • Many companies have announced 25%-70% reductions in drilling and a total of at least $25B in spending cuts; Magnum Hunter (NYSE:MHR) is one that went even further, halting all drilling and telling services firms it will not resume work unless its costs fall 40%, and CEO Gary Evans predicts such cuts foreshadow falling U.S. production within the next two months.
    • After years of breakneck growth, top shale companies Apache (NYSE:APA) and EOG Resources (NYSE:EOG) have said their oil and gas output this year will be flat.
    • Continental Resources' (NYSE:CLR) President Jack Stark calls the precipitous decline in the number of active U.S. land rigs to roughly the level EIA had forecast would be reached in October as "probably faster than I've ever seen."
    • ETFs: USO, OIL, UCO, SCO, BNO, DTO, DBO, UWTI, USL, DWTI, DNO, SZO, OLO, TWTI, OLEM
    | 35 Comments
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OLO Description
All of the PowerShares DB Crude Oil ETNs are based on a total return version of the Deutsche Bank Liquid Commodity Index-Oil (the "Index") which is designed to reflect the performance of certain crude oil futures contracts plus the returns from investing in 3 month United States Treasury bills. The Long ETN is based on the Optimum Yield™ version of the Index and the Short and Double Short ETNs are based on the standard version of the Index. The Optimum Yield™ version of the index attempts to minimize the negative effects of contango and maximize the positive effects of backwardation by applying flexible roll rules to pick a new futures contract when a contract expires. The standard version of the index, which does not attempt to minimize the negative effects of contango and maximize the positive effects of backwardation, uses static roll rules that dictate that an expiring futures contract must be replaced with a contract having a pre-defined expiration date.
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