Market Report & Analysis for 12/7/2018 Morning Edition

by | Dec 6, 2018 | EMI, Fuels & Markets, FutureRack, Industry News

Morning Market Overview

—> BREAKING: Saudi energy minister makes surprise announcement he does not believe production cuts should be more than 1 million barrels per day given Canada’s planned cut of 325 kbpd. Market moving ower. <--- Oil traded in a mixed, choppy pattern Wednesday ahead of today's start of a very important series of OPEC/non-OPEC meetings that will push oil prices in one direction or the other for at least the rest of the year. Oil prices started out the session slightly higher even after a bearish API weekly inventory snapshot as the industry awaits the delayed EIA inventory report due out this morning. The OPEC monitoring committee and its partners have agreed on the need to cut oil production starting in 2019 according to a report in Reuters. The volume and what the threshold of the cut will be is still being discussed. We remain of the view that the group is going to have to make a real cut of over 1 million bpd to quickly change the trend in oil policies as well as the trend in global oil inventories. On the financial front global equity markets were lower with the US closed in observance of President Bush’s funeral. The EMI Index was lower by 0.23 percent for the day with the year to date gain at 2 percent. Only two 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 16.6 percent gain for the year. The lower value direction in global equity markets was a negative 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 lower. Overall the currency markets were a negative price driver for the oil complex last week.[/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section]