WTI's Version of Atari's PONG

By: Daniel Guttman / February 6, 2017

The common question these days, or more accurately weeks, in the wacky world of petroleum has been who is going to win: The Bulls or the Bears? Unfortunately, placing a bet on the outcome of this tug of war match is pure speculation, and nobody truly knows which way WTI oil prices are headed. They rise for a day when news of OPEC production cuts adheres to projections, and then fall when Baker Hughes announces increased rigs. Prices then surge when Iran tests ballistic missiles and President Trump puts them on “the naughty list,” but then prices retract when Russia states its production cuts are greater and ahead of schedule. The back and forth of oil prices, stuck in the range of $50-$55 for WTI, reminds us of Atari’s Pong, except for the fact that the result of the game could be quite costly for the loser.

 

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Key news items:

  • Baker Hughes announced an increase of 14 rigs last week, all of which were oil. Active number of rigs online is now 583, the most since October of 2015.
  • Iran carried out additional missile tests this past Saturday, and rising geopolitical concern between it and the U.S. has President Trump taking responsive action(s).
    • In addition, post-sanction Iran is firing on all cylinders. An Iranian News Agency believes Iran’s oil output will reach 4 million bbls/day in March.
  • January’s OPEC monthly report will be released on February 13th, and will represent the first month of production cut data.
  • Last week’s jobs report showed a nonfarm payroll increase of 227,000, but an unemployment rate increase to 4.8%.

WTI crude is currently down $0.45 to $53.38, and both RBOB and ULSD are down, $0.0117 and $0.0098, respectively.

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Categories: Daily Market Update


Daniel Guttman

Written by

Daniel Guttman

With a background in wholesale and commercial sales as well as pipeline scheduling, Daniel is currently the Manager, Business Development in the Card Access Fuels department. He is tasked to find new and innovative solutions to increase sales opportunities for the sales team while managing and evaluating internal department processes. He assists with day to day personnel management, customer data analysis, as well as the daily Pacific Pride inventory and pricing direction.


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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