Yesterday, oil futures closed lower across the board; WTI closed down $0.56 to $50.79/bbl, RBOB closed down $0.0143 to $1.4829/gal, and HO finished down $0.0229 to $1.5873/gal. The downward pressure came from the IEA October report stating that global oil supply rose 600,000 barrels per day between August and September. It also stated that OPEC is at record high volumes, producing 33.64 million barrels per day, with Russia and other non-OPEC producers pushing to records also. This data weakened the market because it brought back attention to the supply glut instead of the recent focus on the OPEC meetings surrounding a production freeze and/or cut.
Volatility is expected over the next month or two until the official OPEC meeting in Vienna on November 30th. There are many contradictory responses between OPEC and non-OPEC members. There are even contradictory opinions coming from Russia. Russian President, Vladimir Putin, stated he was willing to join in the production cut if other countries also join, but on the other hand, Russian Energy Minister Alexander Novak stated the country is considering keeping production at current levels.
Currently, oil futures are down for a second day. As of 11:00 a.m. ET, WTI is down around $0.70/bbl, and RBOB/HO are both down around $0.02/gal. The next piece of news that will influence the market is the weekly supply statistics that are delayed due to Monday’s Columbus Day holiday. The API statistics will be out tonight, and the DOE statistics will be released Thursday morning at 11:00 a.m. ET.