Supply and demand fundamentals drive oil prices. Things like OPEC+ production plans and US driving patterns matter the most — until they don’t. That’s when the wizardry of Wall Street takes over, giving prices a push up or down beyond what the physical fundamentals warrant.
OPEC and its allies are expected to revive more oil supplies when they meet on Tuesday, underscoring the group’s optimism in the outlook for global demand.
Oil was steady after the biggest gain in two weeks following an announcement by the US of a coordinated release of strategic petroleum reserves (SPR) with other countries that fell short of expectations.
Oil and gas producers, and refineries that fuel the US, are assessing the impact on operations after the passage of Hurricane Ida, with peak daily supply curtailment of 1.8 million barrels per day recorded in the Gulf of Mexico. As a result of the disruption price volatility can be expected in global crude markets.
Saudi Arabia and the United Arab Emirates cranked up the tension in their OPEC standoff as the rare diplomatic spat between long-time allies leaves the global economy guessing how much oil it will get next month.
Oil surged above $71 a barrel in Asian trading after Saudi Arabia said the world’s largest crude terminal was attacked, although output appeared to be unaffected after the missiles and drones were intercepted.
A toxic cocktail of the Covid-19 outbreak and an act of self-sabotage by two of the world’s biggest oil nations has created unprecedented and overwhelming currents for the oil and gas industry to swim against.
Oil climbed to the highest level in two and a half years on expectations a U.S. government report will register the longest decline in crude stockpiles since the summer driving season.
Energy service companies ATR Group and Neptune Marine Services both announced key investments yesterday as they gear up for growth after the oil price slump.
US oil is set for the first weekly drop since mid-September as an OPEC committee meets in Vienna on Friday to discuss output quotas for members participating in an agreement to cut production.
When in Aberdeen last weekend, I walked through Golden Square for the first time this year. I was shocked to see the number of empty buildings with ‘To Let’ signs on them in this once busy part of town. I knew things were hard in Aberdeen, but this really drove it home.
Oil trimmed its weekly gain after the biggest U.S. stockpile slump in 17 years was seen as a one-off caused by a tropical storm that disrupted imports and offshore production.
Oilfield services, shipbuilders and other industries that rose with the pre-2014 oil price boom have had it hard. Since barrel rates fell, their previous patrons have become uninterested in doling out major purchase orders, leaving oil and gas equipment manufacturers without revenues.
OPEC’s crude production climbed to a record last month as increased output from Gulf members made up for persisting losses in Nigeria and Libya, according to a Bloomberg survey.