The oil market just hit a yellow light.
Crude’s advance of more than 90 percent from a 12-year low earlier this year has U.S. shale producers starting to return to their drilling rigs, threatening to slow further gains.
“The $50-to-$60 a barrel area is the sweet spot,” said Mark Watkins, the Park City, Utah-based regional investment manager for The Private Client Group of U.S. Bank, which oversees $128 billion of assets. “You start to have producers come back at $50, but a lot of them come in at $60.”
Money managers were cautious in the week ended June 7, betting more heavily on a price drop than on further gains, according to data from the Commodity Futures Trading Commission. West Texas Intermediate rose 2.6 percent to $50.36 a barrel on the New York Mercantile Exchange during the report week and fell 48 cents, or 1 percent, to $48.59 at 12:14 p.m. London time on Monday.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.