8/25/2015 Market Update

By: Daniel Guttman / August 25, 2015

Today we are witnessing the market reacting to the huge drop off yesterday and China’s decision to drop interest rates by 25 basis points. OPIS reported that prices yesterday dropped to multi-year lows as questions about the state of China’s economy take center stage. As oversupply throughout the global markets continues to be a trend, now the market must confront China’s economic future and its impact on oil. OPIS also stated that if China's thirst for oil diminishes it will likely hurt Middle Eastern crude producers, especially Saudi Arabia. The Saudi’s have relied on Asia to buy the barrels they once sold to the U.S. that have been displaced by increased U.S. crude production.

 

West Texas Intermediate crude closed below $40/bbl yesterday, at $38.62/bbl, for the first time since Q1 2009. Over the last four weeks, WTI has plunged nearly $10/bbl, losing nearly 20% of its value. Overnight, WTI prices were finding some footing, after yesterday's tumble. Up more than a $1/bbl in the overnight session, WTI was around $39.30/bbl at press time. London-based Brent crude was also finding a bit of support, hovering around $44/bbl, up $1.50/bbl.

 

Keep in mind the famous Warren Buffett quote “when you hit rock bottom, the only way is up.” Then there is the old trading adage that “when the bulls turn bearish it is time to buy.”

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Daniel Guttman

Written by

Daniel Guttman

With a background in wholesale and commercial sales as well as pipeline scheduling, Daniel is currently the Manager, Business Development in the Card Access Fuels department. He is tasked to find new and innovative solutions to increase sales opportunities for the sales team while managing and evaluating internal department processes. He assists with day to day personnel management, customer data analysis, as well as the daily Pacific Pride inventory and pricing direction.


Guttman Energy Daily Market Update Disclaimer – The information contained in this market update is derived from sources believed to be reliable; however this update could include technical inaccuracies or typographical errors and Guttman Energy does not guarantee the accuracy, completeness or reliability of this update. FURTHERMORE, THIS UPDATE IS PROVIDED "AS IS," WHERE IS, WITH ALL FAULTS AND WITHOUT ANY WARRANTY OR CONDITION OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY. GUTTMAN ENERGY ALSO SPECIFICALLY DISCLAIMS ALL EXPRESS AND IMPLIED WARRANTIES. YOU USE THIS UPDATE AT YOUR SOLE RISK. This update and any view or comment expressed herein are provided for informational purposes only and should not be interpreted in any way as recommendation or inducement to buy or sell products, commodity futures or options contracts.


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