Crude Archives - Page 42 of 71 - Financial Occultist

Analysts at Citi continue to see an oil price recovery and have increased their average forecasts for Brent and WTI

For Q3 2020:

US$39/bbl and $37/bbl respectively

For Q4 2020:

US$48/bbl and US$45/bbl respectively

Brent and WTI average forecasts for 2020 are at US$42/bbl and US$38/bbl respectively.

Crude oil inventories -7195K vs. -500K estimate

01-Jul-20 08:06 pm

Anirudh Sethi

Weekly Department of Energy inventory data for the week of June 26

Crude oil is trading at $39.70
crude oil inventories – 7195K vs. -500K est. The private data came in at -8156K.
gasoline inventories 1199K vs -1500K est. The private data showed a draw of -2459K
distillates inventories -593K vs 500K est. The private data showed a build of 2638K
Cushing OK crude inventories -263K vs -991K last week
refinery utilization 0.9% vs. 0.5% estimate
crude oil implied demand 17997 vs 17334 last week
gasoline implied demand 9043.3 vs 8893.7 last week
distillates implied demand 4843.7 vs 4594 last week

Some oil news ICYMI – US shale producers to boost oil output by 500,000 bpd by month-end

18-Jun-20 05:26 am

Anirudh Sethi

Reuters report on what analysts & some in the industry are expecting

Larger producers are re-opening the taps in low-cost plays in Texas, but also in expensive shale basins in North Dakota and Oklahoma.
“With prices where they are now, if they stay above $30, I wouldn’t expect any significant curtailments from us in Q3 or beyond,” Devon Energy Corp Chief Executive David Hager said at a J.P. Morgan energy conference on Tuesday.

This would be a rapid (albeit partial) bounce back from prior supply cuts in shale. It’ll add pressure back onto OPEC+ who recently agreed to extend their their output cuts. Supply coming back on line as prices rise … pretty textbook economics this.

Here’s the link to Reuters for more

Reuters report on what analysts & some in the industry are expecting

OPEC sticks to demand-drop forecast

17-Jun-20 07:28 pm

Anirudh Sethi

The latest numbers from the monthly OPEC report

Left 2020 demand forecast at -9.1 mbpd
Says Q2 demand was down 17.3 mbpd
OPEC output fell 6.3mbpd in May based on secondary sources

OPEC’s Joint Ministerial Monitoring Committee meets this week to assess supply-demand balances. So far they haven’t adopted the reopening optimism but noted that higher prices are “suggesting that the supply-demand fundamentals are gradually improving.”

WTI crude was volatile yesterday and has ticked lower today, down 55-cents to $37.84.

The latest numbers from the monthly OPEC report

IEA says oil demand won’t fully recover until at least 2022

16-Jun-20 01:47 pm

Anirudh Sethi

IEA comments on the oil market in its latest report

Floating storage of crude oil in May fell by 6.4 mil barrels m/m to 165.8 mil barrels
Global oil supply fell by 11.8 mil bpd in May
Helped by OPEC+ countries reducing output by 9.4 mil bpd
Sees oil demand next year to rise by 5.7 mil bpd, but still lower than in 2019
Oil demand next year to remain 2.4 mil bpd below 2019 levels

On OPEC+, IEA says that they made a “strong start” and delivered 89% of its pledge to cut output but warns that rising prices could pose a problem:

“The market may present producers with an opportunity to ramp up more quickly than dictated by current OPEC+ policy, or US and other non-OPEC production could recover more strongly than forecast.”

With oil prices having moved up back close to $40, nobody – even US shale drillers – will want to miss out on the party.