Kicking the Market While it's Down

By: Lindsay Farrell / November 20, 2015

Prices continue to push lower this week driven by with a few key factors this week:  Federal Reserve policymakers indicated again that December may be the right time to increase the interest rate; the strength of the U.S. dollar is trading near a 7 month high; and pressure from a continuing global supply glut, expected to last into 2016.  WTI ended Thursday down 21 cents after dipping to $39.89, its lowest since late August of this year when it was at $37.75. 

Goldman Sachs said on Thursday that we could be at risk for a “sharp leg lower,” or a quick move downward, in oil prices.  This is due to forecasted temperatures being milder than normal this winter, causing weaker demand for heating oil in the U.S. and Europe.   This "would likely be the trigger for adjustments through the physical market, pushing oil prices down to cash costs, which we estimate are likely around $20 per barrel," according to Goldman. 

The graph below illustrates the recent volatility in oil prices over the past week. As you can see, the market is sensitive to news events, which will likely to continue in the short term.

2015.11.20.pngGraph: Zero Hedge                                                                                                                  

 

2015.11.25.jpg

 

 


Categories: Daily Market Update


Lindsay Farrell

Written by

Lindsay Farrell

As Manager of Quality Assurance and Regulatory Compliance, Lindsay Farrell is responsible for fuel operability across the company’s terminals and customer sites, as well as keeping up-to-date with the latest regulations and best practices within the industry.


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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