The United States Oil Fund (ETF) ($USO) is headed for another higher finish for this week. The ETF rose more than 1.5% this week.
USO has gained almost 36% in the last three months as oil prices have bounced back sharply. The question though is whether the fund can continue with its gains, considering the strengthening U.S. dollar.
I believe there is further upside in USO, given oil market’s improving fundamentals. This week, two reports showed that stockpiles in the U.S. fell more than forecast. This highlights the fact that U.S. production is declining. The production decline in the U.S. has coincided with supply outages in several places and strong demand.