Under Pressure

By: Matt Rosenberg / September 16, 2016

After a strong day yesterday that saw settles up across the board, the market is giving back some this morning as the ever present supply theme seems to be running strong again this morning.  “Oil prices keep trading in a narrow range.  A short spike yesterday is erased this morning as supply glut worries rule” said an analyst at Global Risk Management Ltd.  The lone exception at this point is the October RBOB contract which is trading higher as the Colonial Pipeline remains down, tightening gas supply in the Southeast and Mid-Atlantic states.  With a capacity of 1.2 million barrels per day, outages are expected to grow and become more widespread in that entire region into the weekend and next week.

The overall market pressure this morning comes as reports of Nigeria and Libya ramping up their oil exports are prevalent.  Royal Dutch Shell and Exxon Mobil have both lifted force majeure on Nigerian exports as the domestic violence there has calmed.  “The perception of more supply from Nigeria and Libya is trumping the physical markets.  The market could care less about strong physical markets when it sees potential for another 600,000 barrels per day of crude” said a North Carolina based broker.  This additional supply news comes on the heels of the DOE report released Wednesday which showed U.S. oil product inventory builds in both gasoline and distillates of 567,000 barrels and 4.6 million barrels respectively.  As the International Energy Agency summarized Tuesday and reported on Bloomberg.com, the oil surplus will last longer than previously thought as demand growth slumps and output proves resilient.   

Newsworthy events to keep an eye on next week will be continued developments regarding the Colonial pipeline repair as well as news coming from the U.S. Federal Reserve policy meeting on September 20th and 21st with regards to interest rates.  The following week OPEC will be meeting in Algiers so pre-meeting rhetoric and comments should be heightened as we get closer.        

0915set.png

 

 

 

 


Categories: Daily Market Update


Matt Rosenberg

Written by

Matt Rosenberg

As a key accounts manager, Matt helps large customers make mission-critical decisions by providing timely advice regarding market conditions.


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.


Comments

Subscribe to our blog

Price Feed

Stay up-to-date on current fuel prices and market trends with our NYMEX price feed (15 minute delay to the live market).

© 2018 Market data provided and hosted by Barchart Market Data Solutions. Fundamental company data provided by Morningstar and Zacks Investment Research. Information is provided 'as-is' and solely for informational purposes, not for trading purposes or advice, and is delayed. To see all exchange delays and terms of use please see disclaimer.

Categories

Contact Us