Market Insights

August 11, 2016 • Posted in Market Insights

Week of August 8, 2016

  • Last Tuesday WTI dipped to $39.51 while Brent dipped to $41.50/bbl
  • WTI hit it’s lowest point since April
  • US rig counts, production and crude inventories have all grown after oil rallied to $50 recently
  • OPEC production rates also remain high
  • Prices rebounded later in the week on a stronger refined products drawdown and news that the US economy added an unexpectedly-high 255,000 jobs in July
  • While the US economy is healthy US demand for oil during this peak season is running below expectations
  • Chinese demand is slowing on economic concerns and demand in Europe is softening on concerns related to Britain’s exit from the European Union
  • The market needs lower prices to clear the inventory glut so there appears to be little to support higher international oil prices in the near term
  • Natural gas prices jumped to around $2.83 per MMBtu NYMEX as hot weather spurred demand

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