Crude oil’s sharp correction may create opportunities as bullish fundamental outlook remains, says Phil Flynn.

It has been a great oil run. After completing its best quarter in a decade, oil continued its weekly streak of gains for eight weeks, which is its best streak since early 2015. Brent crude even hit $75 a barrel after Europe’s oil refineries stopped taking piped deliveries of Urals crude from Russia through the Druzhba pipeline into southern and central Europe after the oil was found to be contaminated, costing the market about one million barrels of oil a day.

Yet after such a run, a pullback may be inevitable. Oil failed to overcome the pre-Energy Information Administration report high due to fears about potential shortages down the road being erased because of that big 5.5-million-barrel jump in weekly supply. Or perhaps bulls simply took some profits. Brent crude also pulled back on hopes that the deliveries from Russia may resume soon. We were due for a correction. Be patient and you may be able to buy a bargain.

Yet while these are good reasons to take profits, the underlying bullish fundamentals have not really changed. There is still fear that Saudi Arabia and the UAE will move slowly to replace lost Iranian barrels. There are still supply risk factors from Venezuela, Libya, and Nigeria. Oil rig counts should also fall.

RBOB futures held up well as supplies are still below average. Ultra-Low-sulfur diesel may come to life a bit later.

Natural gas got an oversold bounce even after a slightly bearish EIA report. The EIA reported that working gas in storage was 1,339 Bcf as of Friday, April 19, according to EIA estimates. This represents a net increase of 92 Bcf from the previous week. Stocks were 55 Bcf higher than last year at this time, and 369 Bcf below the five-year average of 1,708 Bcf. At 1,339 Bcf, total working gas is within the five-year historical range.

Short report today. Have a great weekend!

Go to The MoneyShow Vegas May 13-15. Get you picture taken with Elvis! Or sign up for my master class. Either one works.