An update for oil (via Reuters report)
- Says oil price higher on expectations U.S. output will decline further (some producers are under increasing financial distress) & also API inventory data showed a less-than-expected increase in inventory
(API data posted earlier)
Comments from U.S.-based The Schork Report in a note to clients:
- "Producers are not buying the rumor-mill... In fact, it is just the opposite: speculators are buying what producers are selling... Speculators are record long Brent (on ICE) while producers are record short... Who do you think is going to win out?"
Reuters wrap up with:
- Fundamentally, there are few changes to the supply balance
- Saudi Arabia and Russia have proposed to freeze their output at January volumes, near record levels of over 10 million barrels per day (bpd) each, Iran has said it would only participate once its production hits 4 million bpd from a current 3 million bpd.
- "Any such deal (to freeze output) would still not be a game changer. It would really just maintain the excess supply that is now in place," Thomas Pugh of Capital Economics said in a note.
