EIA data showed a build in inventories, particularly in the products, sending crude lower. Luke Rahbari, CIO of Equity Armor Investments, tells TheStreet’s Jill Malandrino, the concern is the macro situation around the supply stalemate between OPEC and non-OPEC members which will lend to even more inventory builds, putting a lot of pain on marginal and secondary producers. For oil-dependent economies, the approach is counter intuitive because they will continue to produce more in an attempt to make the same amount of money as when oil was priced at higher levels, adding to the supply glut. For this reason Rahbari is not bottom picking and wants to see more attractive fundamentals. As cold weather slams the U.S. Rahbari expects natural gas to potentially move higher, but is getting involved via options for the risk control.
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