Market Report & Analysis for 6/13/2018 Afternoon Edition
Afternoon Market Overview
Crude and products have seen mixed activity today.
The market remains uneasy over the potential of Russia and Saudi Arabia wanting to ease the production cutting accord to offset any loss of production from Iran and/or Venezuela. However, a report was circulating around the media airwaves that the president of OPEC said the US had not asked OPEC to increase production.
The comment by the president of OPEC was taken as a positive but the comment does not preclude the fact that the US may have asked Saudi Arabia to increase production and not directly asking OPEC.
We view the possibility that Saudi Arabia has been requested to increase production as very probable and one that would be bearish for prices going forward. Remember Saudi Arabia holds great power over the OPEC members and historically what Saudi Arabia proposes often gets accomplished and approved by the other OPEC members.
With the high level of uncertainty surrounding the upcoming June 22 OPEC meeting we remain slightly bearish for the short term with a view of the medium term moving into the neutral category. If we have seen the last of the production cutting accord at the current level it would obviously result in a negative market sentiment permeating throughout the global oil markets.