Oil (#WTI, #BRENT) has surged this week since the US Energy Information Administration (EIA) figures showed that US stockpiles of oil are being used at a much higher rate than anticipated, with a decline of 9.89m barrels, in contrast to the projected decline of 2.57m barrels. This has helped oil over the $72/bbl level and there is no reason why it should not try to push higher. This is not a one-way ticket though, and healthy rallies always benefit from a reaction as profit-taking kicks in. We would therefore take the view that, in the absence of any game-changing revelations, such dips should be used to build long positions. Whilst there should be resistance around the $77 level, a test now seems inevitable, although we expect the current steep curve to soften out as momentum is lost. Looking slightly further ahead we do not see any prospect of $100/bbl oil any time soon, so it’s important not to get too carried away, be patient, and take your profits where you can.