With the unexpected increase in US crude inventories (particularly during the driving season), crude oil futures took a beating today. Dollar strength and mixed economic data had an impact as well.
US Department of Energy US crude stockpiles
There is actually more to the story in the futures market. The crude oil curve has steepened considerably in the past month. The market is expecting a pickup in demand in the longer term, but for now the realization has hit that the economic recovery is slow and it will take a while to work through the existing crude inventory. The huge natural gas oversupply in the US puts additional downward pressure on crude. The commodity bet that played out so beautifully for many a year ago is not working out too well this time around.
WTI crude oil futures curve
The demand fundamentals continue to be weak, keeping prices in check and the curve steep.