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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.
OIL
Oil prices continued to slide with algorithmic selling exacerbating the unwinding of the geopolitical risk premium and China-related pessimism. Stronger risk appetite, another large US crude inventory drawdown and the FOMC July minutes signalling that it is looking at a September cut failed to provide support. The USD index was flat.
- WTI fell 1.7% to $71.94/bbl after a low of $71.46, briefly below the bear trigger at $71.67, and has started today around $71.95. It rose to $74.16 following the EIA data. The benchmark is now down 6.4% in August.
- Brent is down 1.5% to $76.05/bbl to be almost 6% lower this month. It reached a low of $75.65, above key support at $75.05, before recovering somewhat. The bullish theme has been undermined. Key resistance is at $82.40.
- Crude rallied initially after the EIA release showing a crude drawdown of 4.65mn barrels last week. Inventories are down 34.7mn barrels since the start of July to their lowest level since the end of January. Gasoline stocks fell 1.61mn and distillate 3.3mn, their lowest since November and early July respectively. Refining utilisation rose 0.8pp to 92.3%.
US EIA crude stocks ex SPR
Source: MNI - Market News/Refinitiv
- Reports continue that ceasefire negotiations may collapse but the situation currently hasn’t changed with Israel agreeing to the US’s “bridging proposal” and Hamas not. Iran continues to hold off attacking Israel.
- UK maritime trade operations reported a Greek oil tanker drifting after being struck four times off the coast of Yemen. It has engine failure but is expected to continue its journey. It had filled in Iraq.
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.
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