WTI down 70-cents to $69.58
Chatter about a resuming Iran nuclear talks is combining with negative risk sentiment to weigh on oil.
WTI fell through yesterday’s low down to $69.58 as it eats further into last week’s gains.
The two-hour chart now isn’t looking great with a minor head and dhoulders top in place targeting a fall back to last week’s lows.
Oil — like everything else — is now looking to China for a read through on global GDP. In the shorter term though, it will be down to the Fed and PBOC to signal what’s next for markets.
IEA remarks in its monthly report
- Vaccine rollouts should help to unlock stymied demand for oil, especially in Asia
- Signs that COVID-19 cases are abating should see demand rebound sharply by 1.6 mil bpd in October and continuing to growth until year-end
- Unplanned outages from Hurricane Ida offset increases by OPEC+
- Estimates that global oil demand fell for three straight months to date amid the COVID-19 resurgence in Asia
- Adds that the market should shift closer to balance from October if OPEC+ continues to unwind output cuts
- By early 2022, supply will be high enough to allow oil stocks to be replenished
A good summary on the oil market situation right now as delta variant concerns are still persisting but less impactful as what we saw over the past few months. Adding to that is the hype surrounding fossil fuels amid a cold winter and higher energy prices.
Oil is up 0.8% today and testing the $71 mark as buyers look to build on a daily break above $70 in trading yesterday.
The US oil industry is still struggling to recover from the damage from Hurricane Ida.
Circa 40% of capacity is still compromised.
Now a new storm is slowing efforts at recovery, at least this one does appear to be as intense as Ida. Tropical Storm Nicholas may gather intensity though, the US National Hurrican Center
- A Hurricane Watch is in effect for…* Port Aransas to San Luis Pass Texas