OIL VIEWSLETTER

Volatility ahead but may not rescue crude from the doldrums - Sept. 25, 2020

Crude futures may have been jolted off their five-month peak in late-August by jitters in the financial markets precipitated by a shock sell-off in US tech stocks. But they have since also reconnected with the physical market fundamentals, which look rather weak.

An anemic and uncertain risk appetite in the broader financial markets, a rebound of the US dollar and fears of global oil demand recovery being overshadowed by the rise in supply are all weighing on crude. 

Little wonder then, that prices have been taking the elevator down and the stairs up. 

As the growing storm of US presidential election politics overlaps with the economic crisis brought on by Covid, the markets will be in for a wild ride. That wild ride has probably already begun. We would expect the noise to increasingly overpower the signal in the coming days and weeks and unpredictability to be the only certainty.

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BULLS & BEARS

Sep Bulls & Bears: Mildly bearish near-term, Neutral for Q4 - Sept. 11, 2020

This issue of Bulls & Bears sees us moving one notch towards bearishness both in the near term and for next quarter compared with the August issue.

We have a Mildly Bearish view on crude prices for the next few days and a Neutral view for the coming quarter. 

The current crude prices – Brent around $40 and WTI around $37 – should be viewed as a baseline for the outlook. 

ENERGY RADAR

energy radar first report - Jan. 13, 2020

Shortly before the markets opened, US President Donald Trump tweeted that he had authorised the release of stocks from the country’s Strategic Petroleum Reserve if necessary, to keep the y 9.30 am Singapore time (0130 GMT), three and a half hours after trade opened for the week on the CME and ICE futures exchanges, crude had calmed down somewhat, to gains of 10-12% versus Friday’s clsoe. markets

BRIEFING NOTES

How big is the oil supply cut -- 9.7 mil b/d or up to 20 mil b/d? - April 14, 2020

Crude has shrugged off the 9.7 mil b/d cut agreed for May-June by OPEC+ on Apr 12.

ICE Brent settled a meagre 26 cents higher, while WTI closed 35 cents lower on Apr 13.

Abdulaziz, Novak and Trump are insisting the actual reduction will be 15-20 mil b/d.

Where is the truth? Somewhere in between or is it creative accounting?

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CRUDE IN SIGHT

Crude flat around Wed's higher settle, awaits further cues - Oct. 1, 2020

Crude futures were trading sideways early Thursday in Asia after notching modest gains at Wednesday’s close, having priced in the bullish and bearish influences for the time being.

While worries over stagnant oil consumption on renewed coronavirus restrictions across Europe’s major cities remain in the background, a somewhat bullish US weekly stocks report and lingering hopes of the US Republicans and Democrats forging a compromise on the country’s coronavirus stimulus package helped crude futures to a positive close on Wednesday.

Workers from one of Norway’s trade unions have gone on a strike at the giant Johan Sverdrup oil field in the North Sea but operator Equinor said on Wednesday it expected production to continue as per normal.

Libyan crude production has reached around 300,000 b/d with a gradual resumption of operations at fields in the country’s east.

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