Commodity Trade Mantra

Posts Tagged ‘OPEC Production’

Oil Prices Rocked By OPEC Reports - But Can’t Stay Low For Much Longer

Due to a very high degree of uncertainty surrounding OPEC intentions, there is likely to be further volatility in US trading on Friday and the potential for significant price gaps at the market open next week. Overall dollar trends will continue to have a significant impact on underlying crude oil prices. Remember, oil prices will not languish at the current depressed levels forever.

Will The Rally In Crude Oil Prices End Today?

The market sell off on product market concerns did not lead any notable change in crude oil fundamentals. Refiners have yet to pull back meaningfully on crude oil purchases & crude oil inventory builds are only starting to turn bearish in both the weekly US statistics and globally. US crude oil inventories are set to build above normal over the coming months.

Crude Oil Prices Spike After EIA Reports Surprise Draw

The EIA sees non-OPEC production dropping 0.7 million bpd this year, while it sees OPEC production up 0.9 million bpd this year & up an additional 0.7 million bpd in 2017 (h/t Iran). It now pegs crude oil demand growth at 1.4 million bpd for this year (up 0.3 million bpd from last month), with the increase in large part due to higher Chinese and Indian demand.

IEA Sees “Light At The End Of The Tunnel” For Oil Markets

The IEA found a variety of reasons to think that the oil markets are turning a corner, including: supply outages in Iraq, Nigeria, and the UAE; the declines in non-OPEC supply; tepid but steady demand; recent weaknesses in the U.S. dollar; and the potential that OPEC takes stronger action to boost prices, although any meaningful steps to reduce supply remain unlikely.

This Is Why $20 Oil Price Is A Possibility

I believe that another plunge in the oil price is required to thrust a dagger through the heart of US shale drillers and the banks that have supported them. Low oil price will at some point result in the situation reversing & prices will turn very quickly. But before that can happen, production momentum needs to be switched off & I dare say that requires a sharply lower oil price.

OPEC Lowers Global Oil Demand Growth Expectations In 2016

OPEC provides this first serving, as they have released the third and final installment of key monthly oil reports after last week’s releases from the EIA and IEA. The cartel has upped its expectation for oil demand growth this year by 84,000 barrels per day to 1.46 mn bpd, but revised its forecast lower for next year by 50,000 bpd to 1.29 mn bpd.

Who Is To Blame For The Global Crude Oil Supply Glut? (Hint: Not Iran)

A long time will pass before significant Iran crude oil may flood developed markets & yet even without Iran crude oil, the market has recently seen a surge in supply and production over the past few months, which has been the true driver of most recent slide in prices. But who is the culprit then to blame for the most recent downturn in crude oil prices?

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