The U.S. Dollar continues to weaken from Friday’s drop off of over $2.00, down only $0.12 as of 12:30 PM EST. With the dollar declining and geopolitical tension strengthening overseas, the market has no choice but to rise. The tension of Niger’s Delta Avenger’s attacking oil facilities in Nigeria have caused Nigeria’s oil production to decrease, from 2.2 million to 1.7 million barrels per day. This group has promised to reduce Nigeria’s oil production to zero, until the government succumbs to its demands of a sovereign Niger Delta State. This tension is heavily supporting the increase in the market and continues to lead headlines across all of the major reporting companies. To soften that aggressive news, Nigeria is set to begin talks with the Delta Avengers, per Nigeria’s Oil Minister this morning. WTI crude has jumped back over $50 a barrel reaching a new 2016 high of $50.37 this morning. Looking at refined products; diesel is up $.0275 and gas is down $-.0075. At this time, crude is up $0.40 to $50.09.
There is continued bullish sentiment in the market, Genscape stated that crude oil inventories at the NYMEX WTI delivery hub in Cushing, Okla., were drawn by more than 1 million barrels last week. Besides that statement, OPIS stated that some surveys showed estimates of more than 3 million barrel draws in the nation’s total crude oil stockpiles last week. Heading further west, India may see their imports suffer in the coming months after the state-owned refiners settled a temporary agreement to buy fuel from the privately-owned refiners in follow up to a sales tax quarrel. Are we finally seeing the global glut deteriorate?
- Ghana’s crude oil output set to triple by the end of 2018 to more than 350,000 bpd
- Janet Yellen stated that Brexit could pose a threat to the US economy and comes as the latest polls revealed that a majority of British voters are in favour of leaving the European Union.
- The IEA stated that China’s thirst for oil is expected to rise by 350,000 bpd this year - half the rate seen in 2015.