Free Trial

Crude Little Changed As Geopolitics Offset Fundamentals

OIL

Oil prices have traded in a tight range and are little changed during APAC trading today as continued geopolitical tensions offset soft supply fundamentals, a trend that has been in place through January. WTI is at $74.28/bbl, close to the low, and Brent hasn’t been able to break through $80 and is currently at $79.44 following a low of $79.43. The slightly lower US dollar hasn’t provided a boost to crude.

  • Supply is expected to remain plentiful and with production beginning to come back on line in Libya following protests and in the US after a cold snap, markets are struggling to rally. But Brent’s bullish prompt spread’s backwardation structure has widened over January, signalling a tightening market.
  • Bloomberg reported that US crude inventories fell 6.67mn barrels in the latest week, according to people familiar with the API data. Gasoline rose 7.18mn but distillate fell 245k. The data is likely impacted by recent very cold weather which reduced output and refining. The official EIA data is released today.
  • Later preliminary January PMIs for US/Europe are released and the Bank of Canada’s decision is announced.

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.