Energy Trader Says Oil Could Move Lower to Shake out the High Cost Producers

EIA Data shows crude oil inventories showed a build of 7.1 million barrels versus expectations of a build of 2.5 million, sending the December crude contract to the $81.60 level, which has held before if you are looking at the charts. From the trading floor of the NYMEX, Peter Amandio tells TheStreet’s Jill Malandrino technical levels on the charts are key to the immediate crude trade. Depending on certain levels it could see $85 following the big drop that it had. If it breaks through $81.60, $85.40 is the next target and if it fails to hold the next stop is $78.00. Amandio says traders are looking for consolidation, but if you see oil fall again, sellers will come out because they have to, such as high cost producers. The oversupply situation does not look like it is going to change anytime soon. Amandio says he would not be surprised to see $78 oil, or lower, just so OPEC could shake out those high cost producers.