UPDATE: EIA report sees crude stocks fall
Head of Commodity Strategy
EIA Report Update: Crude oil stocks dropped in line with the American Petroleum Institute figures due to a 1.1m barrel/day net decline in imports. Production hit a record 11m b/d due to a continued ramp-up in shale oil production. Gasoline stocks rose as refinery demand slowed and net-import rose.
WTI crude is potentially on track to recover back towards the centre of the current range between $68.60 and $69.90/barrel.
“Iran says Israel, U.S. will be targeted if Washington attacks” is the headline from this Reuters article quoting a senior Iranian cleric.
Tanker tracking data from Platts show that Iran’s crude oil exports have fallen sharply during the first half of August. During this time they saw 1.68 million b/d being exported, some 640,000 b/d below the average for July. This will undoubtedly raise pressure on the remaining Opec members and also raise the question whether they will be able to meet the potential shortfall – not only from Iran but also from Venezuela which continues to deteriorate.
Also driving the market higher today is speculation that the Weekly Petroleum Status Report from the US Energy Information Administration due at 14:30 GMT may show a bigger than expected drop in crude stocks. This comes after API reported a 5.2 million barrel drop in US crude stocks.
Estimating weekly crude stocks has become increasingly difficult following the rise in US exports during the past couple of years. This seems to have increased the volatility in the weekly net import figure and it is here we normally find the main reason for a discrepancy.
Latest Market Insights
Outrageous Predictions 2023: The War Economy
- The constantly growing global need for energy drives the world's richest to huddle up and launch a R&D project in a size the world hasn't seen since the Manhattan Project gave the US the first atomic bomb.
French President Macron resignsThe political stalemate in France and the rise of Marie Le Pen following the 2022 elections corners President Macron, forcing him to give up on politics and resign from his position. At least for now.
Gold rockets to USD 3,000 as central banks fail on inflation mandateAs markets and central banks realise that the idea that inflation is transitory is wrong, and that prices will remain higher for longer, gold is sent through the roof, hitting a price tag of USD 3,000
EU Army forces EU down path to full unionWith continued challenges in the region and a US military that isn't aggressively enacting its former role as global policeman, the European Union agrees to create its own armed forces, bringing the whole region closer.
A country agrees to ban all meat production by 2030In an effort to become one of the global leaders on the path to net-zero emissions, one country decides to not only put a heavy tax on meat, but to ban domestic production entirely.
UK holds UnBrexit referendumFollowing a recession and domestic pressure, the United Kingdom is thrown into political turmoil that will end with a vote to wind back Brexit.
Widespread price controls are introduced to cap official inflationHistory tells us that with the war economy comes rationing and price controls. And this time is no different, as policymakers introduce strict price controls that lead to a range of unintended consequences.
OPEC+ & Chindia walk out of the IMF, agree to trade with new reserve assetSanctions against Russia have caused widespread turmoil due to US Dollar moves in countries across the globe that don't consider the US an ally. To relieve themselves from this, they leave the IMF and create a new reserve asset.
USDJPY fixed to the USD at 200 as Japan overhauls financial systemFollowing the challenges that faced the Japanese Yen in 2022, the Bank of Japan attempts to keep the currency from sliding. Unsuccessful on the long-term, Japan will launch a reset of its entire financial system.
Tax haven ban kills private equityWith the war economy comes an increased focus on national interests and sovereign nations' ability to assert themselves. In that regard, the OECD countries turn their attention on tax havens and pull the big guns out, banning them altogether.
Please read our disclaimers:
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/en-gb/legal/disclaimer/saxo-disclaimer)