Oil prices are seeing some slight support this morning due to a weakening dollar, as we try to gauge which way this market is headed.
There has been so much going on in the world recently that it’s hard to assess exactly what it all means for oil prices going forward. Interest rates are going up, unemployment is headed down, but one question still remains: will OPEC/non-OPEC producers continue production cuts beyond June?
Saudi Arabian Energy Minister Khalid Al-Falih sure seems to think so. In an interview with Bloomberg yesterday, he spoke about oil stockpiles being above the five-year average for output. Al-Falih believes that six months of production cuts will not be enough to overcome the supply glut, which continues to hover over the market.
OPEC is scheduled for a meeting in Vienna on May 25 to revisit the topic of production cuts and if they should be continued or not.
As you can see from the chart above, stockpiles were declining during Q3 2016 for the first time since Q3 2014, but have begun to head back up towards the high seen in Q2 of 2016.
As of 10:53 AM, the NYMEX is relatively flat on both Heating Oil and RBOB, and WTI Crude seems to be quite flat as well, up only .07 cents as of this writing.