As Expected CRUDE sliding……………Crucial level and last hope :Our Members knows.
Russian oil min Novak out with comments. Livesquawk reporting 17 Oct
- oil prices good for current projects, too low for future
- sees positive trend in oil talks
- Saudi and Iran seem more flexible in talks
Brent crude currently $51.60 in retreat from $ 52.00 again. WTI $50.01 from $50.30 highs
USDCAD therefore nudging its way higher to 1.3181 from 1.3151
Comments from the Iranian oil minister
- We should decide in November how much each country should produce
There’s been no end of comments from Iran so far today as the deputy oil minister was out earlier too saying that the early defined agreement in Algeria was a “baby step” in the right direction. He confirmed that Iran’s current output is 3.85mbpd, with exports at 2.2mbpd.
None of the comments are having an effect on prices as Brent sits at 51.75, with a 51.54/95 range.
Crude oil inventories for the week ending Oct 7
- Prior was -2976K
- Gasoline inventories -1907K vs -900K exp
- Prior gasoline +222K
- Distillate inventories -3746K vs -1200K exp
- Prior distillates -2359K
- Production -0.2% w/w to 8.467 mbpd
- Production -7.1% y/y
API reported a 2700K build in oil supplies, according to sources. They also estimated a gasoline draw of 688K barrels and distillates down 4520K.
The kneejerk reaction in crude has been lower on the strong headline draw.
With OPEC/NOPEC headlines the biggest drivers in recent days, the first inventory build in six weeks (according to API) sparked notable weakness in WTI after hours. The 2.7mm build (bigger than the 2mm expectation) is the largest since April. Gasoline stocks also rose (against expectations of a draw) as Cushing (and Distillates) saw a significant drawdown which we suspect are hurricane-affected moves.
- Crude +2.7mm (+2mm exp)
- Cushing -1.352mm (+100k exp)
- Gasoline +688k (-900k exp)
- Distillates -4.517mm
For the first time in six weeks, crude inventories rose last week by the most in 6 months. We also note a massive drawdown in Distillates (most since Oct 2014) due to the Hurricane…
Following yesterday’s latest IEA report which showed that OPEC production had hit an all time high, this morning OPEC released its own estimate of production by OPEC member nations for September and, not surprisingly, the latest report showed that in the month OPEC was supposed to be set on “cutting” production, the 14-nation group produced a whopping 33.39 million b/d crude in Sept., up 220k b/d from August.
While Saudi Arabia showed the largest decline of 88K to 19.49mmbpd, other members promptly ate up the Saudi market share which as recently as last month hit a record. To wit
- Iraq +105k, 4.46m
- Nigeria +95k, 1.52m
- Libya +93k, 363k (an increase of 34%)
OPEC, Sec Gen Barkindo speaking from Istanbul
- Atmosphere is more positive now with non-OPEC countries
- OPEC and non-OPEC meeting to take place on Wednesday
The silence from the US to all these freeze and cut comments is deafening, as they have mostly been all through the Saudi game of market share chicken.
Brent did manage to break the June highs around 52.80/85 so expect that to be the first main point of support if we fall back.