US Oil Producers increased investment… EIA

The EIA’s “Today in Energy” has some nice charts showing producer investment and cash returns:

And while I’m not sure what the CFTC’s exact definition of “merchants” is (could “merchants” include oil traders who may be hedging barrels on the high seas?), the EIA shows that the category “producers and merchants” is near a 10 year high:

“Many of these companies use oil futures and options to hedge their investment in production into the future. Financial hedging for producers reduces the effect of a fall in revenue if prices were to decline. A measure for the amount of future production oil companies have hedged is the number of short positions, or future sales into these markets. These short positions consist of futures and option contracts held by producers and merchants. Producers have begun using them more since crude oil prices rose above $50 per barrel in the fourth quarter of 2016. In mid-February 2017, the number of short positions in U.S.-based futures and options reached 756,000 contracts, close to the 10-year high of 802,000 contracts.”