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OIL: OIL DOWN ON LIBYAN COMPROMISE. 

OIL
BulletEnergy BulletsCommodities
  • Libyan factions have announced that a compromise has been reached on appointing a new lead for the Central Bank.
  • Libya’s Eastern and Western regions have been in dispute since mid-August following attempts by the Central Government to replace the Head of the Central Bank.
  • The dispute resulted in the shutdown of production and exports of oil in the East, the main supplier of crude from the country, were suspended.
  • The news of the compromise saw oil slip in the US afternoon with West Texas Intermediate declining more than 2%, to break through US$70 to settle at $69.60.
  • Brent too trended lower on the news initially breaking through US$73.50 before settling at US$73.67.
  • Oil has had a push pull week given the China stimulus news, providing support to risk markets in general as the policy measures announced are aimed at resolving the housing crisis in China.
  • As always geo-politics is never far away when it comes to oil and comments by the Iranian President that ‘Israel attacks in Lebanon cannot go unanswered,’ provide support to oil prices.
  • The key risks at present is how Libyan production comes back online and the supply risks associated with that.
  • Lastly news of Hurricane Helene in the Mexican gulf has been sidelined given Libyan and Israel / Lebanon news yet it is now impacting production and supply and projected to make landfall in Florida Thursday or Friday US time.
  • Despite all of these factors it is likely that oil’s fortunes today will be impacted by a deluge of data tonight from the US including GDP, Core PCE, Durable Goods and Initial Jobless Claims. 
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  • Libyan factions have announced that a compromise has been reached on appointing a new lead for the Central Bank.
  • Libya’s Eastern and Western regions have been in dispute since mid-August following attempts by the Central Government to replace the Head of the Central Bank.
  • The dispute resulted in the shutdown of production and exports of oil in the East, the main supplier of crude from the country, were suspended.
  • The news of the compromise saw oil slip in the US afternoon with West Texas Intermediate declining more than 2%, to break through US$70 to settle at $69.60.
  • Brent too trended lower on the news initially breaking through US$73.50 before settling at US$73.67.
  • Oil has had a push pull week given the China stimulus news, providing support to risk markets in general as the policy measures announced are aimed at resolving the housing crisis in China.
  • As always geo-politics is never far away when it comes to oil and comments by the Iranian President that ‘Israel attacks in Lebanon cannot go unanswered,’ provide support to oil prices.
  • The key risks at present is how Libyan production comes back online and the supply risks associated with that.
  • Lastly news of Hurricane Helene in the Mexican gulf has been sidelined given Libyan and Israel / Lebanon news yet it is now impacting production and supply and projected to make landfall in Florida Thursday or Friday US time.
  • Despite all of these factors it is likely that oil’s fortunes today will be impacted by a deluge of data tonight from the US including GDP, Core PCE, Durable Goods and Initial Jobless Claims.