WTI Crude is up over 6 percent in 24 hours since yesterday’s surprise build (and production cut), as the machines squeeze out an over-exuberant short positioning once again. However, just as we saw last year around this time, Astenbeck’s infamous oil veteran Andy Hall is warning that a “violent reversal higher” looms again amid extreme positioning and potentially improving fundamentals. Exaggerating the move further is the surge in the contango which has once again made sea-storage profitable, sending yield-seeking traders into the carry trade (and squeezing shorts further). As Bloomberg reports , despite what Hall called a “miserable month” for oil in July, supplies are still shrinking, he said in his letter, setting up prices to reverse themselves. “Prices are now back at levels that would ensure the eventual bankruptcy of most of the oil industry”, hammering both private oil companies and producing countries like […]