WTI Oil Price increased 11% in October

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dan_s
Posts: 34471
Joined: Fri Apr 23, 2010 8:22 am

WTI Oil Price increased 11% in October

Post by dan_s »

Trading Economics:
"WTI crude futures reversed earlier losses to settled 0.9% higher at 83.57 per barrel in the last session of October, close to a seven-year high of $85.41 hit on Monday, on expectations that OPEC+ would maintain production cuts during next Thursday’s meeting. For the month, oil prices jumped more than 11%, as demand received a boost from a double whammy of coal and natural gas shortages in Europe and Asia, while OPEC+ nations kept supplies tight. The oil producer group sees world oil inventories declining by an average of 1.1 million barrels a day until the end of the year. Still, concerns about a larger-than-expected addition in US crude oil inventories last week and a likely return of Iranian oil to the markets, caused the contract to fall about 0.6% on a weekly basis, snapping a nine consecutive weekly rally."

OECD petroleum inventories will continue to fall thru year-end. Q1 is the seasonal low point for oil demand. Global oil demand ramps up quickly in Q2, usually be ~2 million bpd each year. By the end of Q2, OPEC+ will probably be out of spare capacity. At that point the only option is to ration oil by price.
Dan Steffens
Energy Prospectus Group
dan_s
Posts: 34471
Joined: Fri Apr 23, 2010 8:22 am

Re: WTI Oil Price increased 11% in October

Post by dan_s »

Trading Economics:
"US natural gas futures retreated further to $5.5 per million British thermal units at the end of October, erasing roughly 10% in the past couple of sessions, pressured by higher domestic output prospects and falling European gas prices, following the announcement by Russian President Vladimir Putin that Gazprom would start refilling its European gas-storage facilities from November 8th. Output in the US Lower 48 states averaged 92.4 billion cubic feet per day so far this month, up from 91.1 billion cfd in September and close to a record 95.4 billion cfd hit in November 2019. Also, EIA figures showed a larger-than-expected 87 billion cf build up of natural gas stockpiles last week. On a monthly basis, the contract is headed for a 5.8% drop, snapping a rally that has been building up since April, and culminated in a 7-year high of $6.5 per million British thermal units reached on October 6th."

We may see a draw from US gas storage the week ending Nov 5 as weather forecast has turned much colder for first half of November.
See 10-day forecast here: https://weather.com/maps/tendayforecast

DEC21 is now the "Front Month" NYMEX contract.
Dan Steffens
Energy Prospectus Group
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