Morning Market Overview
The oil complex was hit with selling for most of last week as the complex put in the fourth weekly decline in a row just days ahead of the official start of the new round of US sanctions on Iran. Despite declining crude oil exports from Iran global supply is currently more than adequate to offset the loss of oil from Iran.
OPEC and its non-OPEC producers have increased production strongly over the last month or so with the US producing at a record high level with further increases on the way. Barring an unexpected reduction in supply from places like Libya or Nigeria oil is not likely to rally on the start of Iranian sanctions alone.
Friday afternoon the latest Baker Hughes data hit the media airwaves reporting the number of rigs deployed to the US oil sector decreased by 1 rig on the week after increasing during the previous week.
Total rigs deployed to the oil sector are higher by 145 or 19.9 percent year over year. Total US crude oil production is about 19.9 percent above where it was for the same week a year ago. This week’s production came in at 11.2 million bpd.