قالب وردپرس درنا توس
Home / Business / Do oil traders already look beyond the Saudi oil crisis?

Do oil traders already look beyond the Saudi oil crisis?



The oil markets went wild this week in the wake of the drone strike at one of the world's most important crude processing plants. The attack led to Brent crude futures rising by 20 percent trading early Monday morning. Despite the severity of the supply shutdown (around 5.7 million bd per day), sources from Saudi Arabian and OPEC markets quickly confirmed that crude flows would not be abolished.

As a result, prices fell 6 percent Tuesday morning, continuing to fall on bearish stock the same day.

Riyadh was quick to confirm to some of its Asian trading partners that it would be able to deliver all contracted volumes. So far, there have been no reports of failed loading / delivery, although there were rumors on Thursday morning that the Saudis had asked to buy additional crude oil from Iraq. True or not, Saudi Aramco sources quickly said to deny this was not the case.

The US, China's trade war and concern for the global economy have for months driven bearish sentiment in the markets, but this week, albeit briefly, traders' attention returned to the equation's supply side.

The key questions this week are: how quickly can Saudi Arabia restore its production capacity and how serious is this supply shortage in reality?

Although they cannot tell the whole story, Brent lookups can shed light on what the most informed oil buyers believe at the moment. Related: US and Russia fight against this huge Iraqi gas field

At the beginning of the curve, the 1

-month Brent spread traded at 107 late backwards, suggesting that power outages would last at least a few weeks. The 2-month / 3-month spread trades at 94 cents reversed, the third / fourth month spread trades at 67 cents remaining and the 4-month / 5-month spread. Burnt spread traded at 49 cents remaining. We have to go all the way to the 7/8 month spread to find a diff that trades to less than 40 cents backwardation

The sharp decline in the futurum price curve here suggests that major oil buyers do not fully believe the Saudi argument that it will recover full production by the end of September.

Bearish sentiment in August almost led to a cash situation in the market, and although many analysts still believe that the second half of 2019 will see relative density in raw markets, sentiment is important.

(Click to enlarge)

While bullish sentiment lifted the future price curve on Monday, the tide on Wednesday with the price difference between one-month and 7-month Brent contracts narrowed rapidly, suggesting a more bearish point of view.

Although there is still uncertainty about how Washington and Riyadh will respond to what they have identified as Iranian soil attacks, with Iranian equipment, there seems to be some kind of consensus that the market remains adequately delivered.

Currently, the geopolitical risk premium in oil remains intact, and oil continues to trade slightly higher, but unless the Persian Gulf is shocked by a new attack such as that at Abqaiq and Khurais, prices will probably not return prices in short term.

By Tom Kool from Oilprice.com

More top readings from Oilprice.com: 3.819659017 ch function (f, b, e, v, n, t, s) {if (f.fbq) return; n = f.fbq = function () {n.callMethod n.callMethod.apply (n, arguments): n.queue.push (arguments)}; if (f?! _fbq) f._fbq = n; n.push = n; n.loaded = 0 ;! n.version = & # 39; 2.0 & # 39 ;; n.queue = []; t = b.createElement (e); t.async =! 0; t.src = v; s = b.getElementsByTagName (s) [0]; s.parentNode.insertBefore (t, s)} {window, document, & # 39; script & # 39 ;, "https: //connect.facebook. net / en_US / fbevents.js & # 39;); FBQ (& # 39; init & # 39 ;, & # 39; 247445556002302 & # 39;); FBQ (& # 39; tracks & # 39 ;, & # 39; page views & # 39;);
Source link