EU Weighs 100M Barrel Reserve Release as Oil Slides 3%
USOI is trading near its 52-week low of $41.9 (7.5% above the low) on light trading volume (0.4× avg).
Summary
Oil prices fell sharply after Reuters reported France proposed releasing 50 million barrels of diesel from EU reserves and 50 million barrels of crude from IEA members. The EU is holding crisis talks Friday, and Brent dropped 2.8% to $99.46 while WTI fell 3.5% to $89.66. This follows yesterday's report of U.S. pressure on France and Germany to release stockpiles, but today's headline adds concrete volumes and a new trading session's price decline. For USOI, a covered call ETN on crude oil, a reserve release would likely cap upside and pressure the underlying, though the ETN's covered call strategy may partially offset losses. Watch for the outcome of the EU crisis talks and any official announcement of reserve releases.
At the time of this announcement, USOI was trading at $45.05 on NASDAQ in the Energy & Transportation sector. The 52-week trading range was $41.90 to $61.30. This news item was assessed with negative market sentiment and an importance score of 7 out of 10. Source: Seeking Alpha.