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Oil Report For Thursday
By Paddy Power Trader on September 10, 2009 | More Posts By Paddy Power Trader | Author's Website
WTI crude futures were on an upward trend overnight in Asia, underpinned by gains in the Nikkei and bullish API numbers. However, since then WTI has pared back some of its gains as European equities came under pressure and the USD index (+0.15%) edged higher.
In terms of OPEC news, the cartel yesterday agreed to keep production quotas unchanged and to improve on current compliance which stands at around 68%. The OPEC Secretary-General al-Badri said that he foresaw 80-85% compliance as a practical target. He also said that a weaker USD was an ongoing concern and that he had hopes the US government would do more to prevent its volatility.
In IEA news, the agency has raised its estimate for 2009 global oil demand by 500K BPD and 400K BPD for 2010 due to stronger demand from Asia and North America. The IEA also said it sees a distillate overhang, with future prices likely to be affected by how long this continues.
Yesterday we saw the weekly release of API inventories, the data came in as follows:
US API Crude Oil Inventories (Sep 4) W/W -7216K vs. Prev. -3193K
US API Gasoline Inventories (Sep 4) W/W 571K vs. Prev. -2811K
US API Distillate Inventories (Sep 4) W/W 3282K vs. Prev. 920K
Looking ahead to today’s DOE inventories and EIA Nat. Gas Storage Change data, consensus of analysts surveyed by Bloomberg currently stands at:
- DOE Crude Oil Inventories: -1850K (Range: Low -3100K, High +2000K)
- DOE Gasoline Inventories: -1500K (Range: Low -2500K, High +2000K)
- DOE Distillate Inventory: +1000K (Range: Low: -1000K, High +2000K)
- DOE Refinery Utilization: -0.38% (Range: Low: -3.00%, High +0.60%)
- EIA Nat Gas Storage Change: 72 (Range: Low 62, High 100)
On the geopolitical front, the WSJ writes that Iran has offered little in the way of new proposals related to its nuclear program, citing diplomats familiar with Tehran’s plan.
The latest Weather Derivatives forecasts see temperatures for the next 6-10 days in the U.S. to be 2.7F above average for this time of year. Finally, the NHC reports Fred remains a powerful hurricane and is expected to turn Northward, with a significant decrease in forward speed, later this evening. Current maximum sustained winds are approximately 105mph. The NHC sees Fred becoming a tropical storm by Saturday.
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