September 20, 2024 04:00 GMT
OIL: Stronger on the Week Post FED - Focus Back on Middle East.
OIL
- As markets now digest what is viewed as a ‘Dovish’ fed rate rise, a positive tone has swept across risk markets into year end.
- WTI rose in Thursday US trading, touching US$72.50 before settling at US$71.92.
- Brent futures too rose trading above US$75 briefly before settling at US$74.75.
- For the week, WTI was up 4.71% and Brent 4.37%.
- Equity markets were strong across the broad as the expectation that the Federal Reserve seems confident of engineering a soft landing for the US economy.
- As always, the possibility of a further escalation of tensions in the Middle East hangs over the oil market following comments from the Israeli Defense Minister suggested a ‘new phase’ in the war is imminent.
- In the US, this time of year sees US refiners undertaking maintenance ahead of winter. This maintenance usually results in an interruption of supply. US refiners release how many barrels of daily processing are not processed due to maintenance and this year the impact is the lightest seen in three years.
- Also in the US, data on US inventories show that the decline in inventories by US storage hubs sees their levels at near five-year lows. This points to potential upside in the demand cycle as and when these inventories begin to get replenished.
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