VelocityShares 3X Long Crude ETN (NYSEARCA:UWTI) Jumps on Forced Plant ShutdownAuthor: Victor AlagbeLast Updated: March 12, 2020 The VelocityShares 3X Long Crude ETN linked to the S&P GSCI Crude Oil Index Excess is louded by murmurs of a great outlook ahead as oil prices start to look up from previous lows.The Wall Street Journal reports that the steep plummet being recorded in oil prices had a brief halt as the price of Brent crude rose from 6-year lows today. In line with the gains recorded in global oil prices, the VelocityShares 3X Long Crude ETN linked to the S&P GSCI Crude Oil Index Excess has recorded gains of 3.52% to $0.0964 as at 1:18PM EDT.WSJ reports that the price of light sweet crude for September delivery increased by $0.37 at $41.17 per barrel on the New York Mercantile exchange. The gains recorded in today’s session can be linked to a report that was released by the U.S. Energy Information Administration yesterday. In the report, the EIA noted that the volume of U.S. commercial oil stockpiles in the last week has increased in a sharp contrast to the widely held belief about a reduction in inventories.Low supply leads to an increase in priceAnalysts at broker Marex Spectron says the key to any decent gain in the price of crude oil is tied to a drop in its supply. In his words, “Supply remains the main obstacle to any potential price recovery.” It appears that there is a reduction in the supply output of U.S. oil and that the reduction is feeding into the gain being recorded in VelocityShares 3X Long Crude ETN.For instance, the volume of domestic crude inventory in the U.S. increased to 456.2 million barrels last week, up from 453.6 million barrels in the previous week. The EIA notes that the U.S. oil output dropped by 0.5% in the current week even though it is still near a multi-year high of 9.3 million barrels per day.BP outage crashes supply The gains being recorded in the oil market can also be linked to a reduction in output as BP Plc announced the forced shutdown of its Indiana refinery last week. BP says it was forced to halt production at the plant because of an unscheduled repair work.The VelocityShares 3X Long Crude ETN linked to the S&P GSCI Crude Oil Index Excess may be able to expect to see more gains going forward as the supply stream continues to compact.The EIA has previously reported that refiners in the U.S. Midwest were working at 99% capacity. The fact that they have already maxed out their capacities means that they won’t be able to increase production to make up for the forced shutdown of BP’s plant.