Market Report & Analysis for 3/1/2019 Morning Edition

Morning Market Overview

Oil prices stormed higher Wednesday after a bullish weekly oil inventory snapshot that showed across the board draws with total combined stocks of crude oil and refined products declining 17.8 million bbls on the week. The report also showed that the US was a net exporter of oil (combine crude and products) for the week ending February 22. This is the second time the US net exported oil in the last three months.

The trend is heading in the direction of the US to be consistent net exporters of oil as US crude oil production continues to march higher. As discussed previously it is going to take more than a few tweets from President Trump to derail the uptrend in oil prices that have been in play since the end of December.

With OPEC and its partners still cutting production at a high compliance level and Venezuela spiraling out of control the global surplus of oil is starting to diminish (as seen by the US inventory assessment) which will keep oil prices trading with an upside bias for the near term. On the financial front global equity markets were mixed around the world resulting in the overall EMI Index moving slightly higher for the day.

The EMI Index was higher by 0.19 percent for the day with the year to date gain at 10.7 percent. All ten bourses in the Index are in positive territory for 2019 with London holding the worst performing spot in the Index with China in the top spot with an 18.5 percent gain for the year. The higher value direction in global equity markets 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 lower. Overall the currency markets were a negative price driver for the oil complex.