Market Report & Analysis for 12/13/2018 Morning Edition

by | Dec 12, 2018 | EMI, Fuels & Markets, FutureRack, Industry News

Morning Market Overview

Oil prices traded in positive territory throughout Tuesday’s pre-inventory report session and after the EIA released their December forecast which in our opinion was slightly biased to the bearish side.

Adding to the market volatility was also a clash between President Trump and the Democratic leaders over funding for the border wall with the possibility of a government shutdown clouding the issue. The oil markets (much like the major financial markets) are being influenced more and more by the 30 second news snippets hitting the media airwaves that seem to have anything to do with the economy as more and more oil market participants have shifted their focus from the supply side to the consumption side of the equation.

The active algo trading systems are also pushing the market very quickly when any of these stories hit the newswire. In the afternoon the API started the weekly inventory report cycle with a larger than expected draw in crude oil, a smaller than expected build in distillate fuel inventories and a surprise draw in gasoline stocks. Total combined inventories of crude oil and products were strongly lower on the week. Overall the market gained ground after the API inventory report release hit the media airwaves.

On the financial front global equity markets were mixed today.

The EMI Index was higher by 0.29 percent for the day with the year to date loss at 1.1 percent. Only one of the ten bourses in the Index are in positive territory for 2018 with China holding the worst performing spot in the Index with Brazil in the top spot with a 13.1 percent gain for the year.

The higher value direction in global equity markets today was a positive price driver for the oil complex. On the currency front the US dollar Index was higher for the day with the Yen/USD and the Euro/USD mixed. Overall the currency markets were a negative price driver for the oil complex.