Daily Market Briefing
Brent oil price remains in the mid-sixties on mixed news and data
Weighing on oil prices was yesterday’s weekly oil stocks data from the American Petroleum Institute (API) which showed a heavy climb in crude oil inventories of 7.3 mio. barrels where consensus was a small build. The data also differed widely from last week’s 4.2 mio. barrel-draw in crude oil stocks. Now this afternoon’s report from the Energy Information Administration (EIA) will be followed closely for deviation/confirmation of the trend. Last week’s EIA data showed a 8.6 mio. drop in crude oil inventories last week.
One of the world’s largest oil consumers, China, lowered its economic growth forecast which is potentially bearish for oil prices as oil demand could be affected as well. However, the country could add stimulus measures to spur growth, so the influence on the oil consumption remains uncertain.
The re-opening of one of Libya’s largest oil fields over the next days could send up to 315,000 barrels of sweet Libyan crude oil per day in the market. The oil field has been closed since December where the country declared force majeure on production.
The current oil production cut deal which took effect from 1 January this year between OPEC and some non-OPEC oil producers could be extended beyond the initial time frame. According to Saudi Arabia’s energy minister, the parties are considering extending the deal into second half of 2019. The comments were supportive of oil prices