Crude Off Lows But Possible Supply Increase Weighs On Prices

Oil is off its intraday low but still down during the APAC session. Prices fell almost 1.5% on Wednesday and are down another 0.3% today, as a possible easing of sanctions against Venezuelan oil would increase supply. The USD index is 0.1% lower.

• WTI is down 0.3% to $78.62/bbl but off the low of $78.27 earlier in the session. Brent is 0.3% lower at $82.99 but has struggled to hold breaks above $83 today. It is off the low of $82.64.
• The possible temporary lifting of sanctions against Venezuela comes at a time of soaring Iranian crude shipments, but also Saudi/Russia output cuts and low US stockpiles. The market also remains concerned re demand given the disappointing recovery in China and possibly further rate hikes in the US.
• Woodside employees vote today on the “in-principle” agreement between the company and unions. If supported, industrial action will be called off. The Chevron ballot deadline is today. European LNG prices fell on Wednesday on optimism that there would be a deal.
• Later the Fed’s Harker and Collins speak. On the data front there are US jobless claims, July durable goods orders and Chicago & Kansas City Fed Indices.