Oil prices are showing some signs of life as key indicators start pointing in a bullish direction.
One of the big indicators to watch that will determine which way oil prices are heading is the rate at which oil producers are storing oil. As U.S. shale production surged in recent years, and demand began to slow, oil was increasingly diverted into storage. The U.S. saw oil stockpiles explode to their highest level since at least World War II over the last six months.
The big question is when demand will sufficiently pick up and/or supply will sufficiently decrease so that those inventories stop rising. The speed with which inventories are increasing has indeed slowed a bit. Two weeks ago, there was arise of just 1.3 million barrels, one of the lowest levels in months.Read about other indicators that oil is on the rise by clicking here.
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