Energy Futures Update

Bullish inventory data gave Crude Oil renewed upward momentum, yesterday, driving prices higher amidst good volume trading.

The headline numbers showed that Crude Oil inventories dropped -4848k vs 1800k barrels and Gasoline -3750k vs -1500k, whereas distillates show a slightly lesser draw than expected.

Moreover, the EIA also published expectations that there is a high probability of a sharp tightening in the market, citing a very uncertain non-OPEC growth in oil production for 2007 and 2008.

Without too much detail, we continue to see increasing demand against a decreasing scale to production (refinery utilisation was down once again too) from OPEC and Non-OPEC countries, and, quite frankly at some point, something has got to give.

We will be looking for an opportunity for some longer term bullish positions in the near future.

All in all, this left the market with a bullish tone, one that is expected to continue throughout the rest of the week. However, we are still waiting for major resistance to be broken, with all eyes focused on $62.50, setting up for a move towards 63.35 and 65.04.

Buy April WTI Crude on any setbacks towards 61.12, targeting a move higher towards 63.35 and 65.04.