EIA Petroleum Reports: How to Profit from this Report

The release of this report is done by the US Energy Information Administration (EIA), and it describes the current import/export and inventory levels of crude oil, gas, and other distillates (for me I'm more focused on Crude Oil since my broker only displays this type of future). To profit from this report (crude oil) you look at the current inventory supplies and depending on how much is gained/loss. Here is a summary:

• Strong demand (strong economy), low inventory - higher prices
• Strong demand (strong economy), high inventory - little to no change in price
• Weak demand (weak economy), low inventory - little to no change in price
• Weak demand (weak economy), high inventory - lower prices

In order to determine whether the economy is strong or weak you have to keep you ear to rail. That means looking at other reports such as Jobless Claims, or CPI, or current GDP.

For the most part, I find that this report only works in the VERY short term. That means in and out in a couple minutes, even seconds.

So here's an example of what to do:

• The report comes out 7:30AM Pacific Time
• The report says supply levels are down, so you believe the price will go up:

• Sure enough, the price goes up
• ....But not for long:

• The there is bigger story for commodies running today, that is making them decrease in price

So, the point to this example: Get out early!... unless the direction of the report coincides with the direction of other market sentiment.