Oil Action: NYMEX crude
Oil Action: NYMEX crude has rallied to levels last seen on Monday, topping at $58.39 in early N.Y. trade, and up from yesterday's low of $56.91. On-the-fact selling took place after the OPEC/NOPEC agreement to extend output caps through 2018, as widely expected. Buyers have stepped in since then, as inventories are likely to continue to draw down through H1, 2018. The wild card of course, is U.S. shale production, which at current crude price levels is expected to increase through 2018. U.S. producers have been hedging through 2018, locking in profitable prices, and allowing for the expansion of drilling going forward. U.S. production is expected to hit 10.0 M bpd in H2, according to EIA estimates, up from current record highs near 9.6 M bpd.