Skip to main content

Cantor Fitzgerald: US inventory builds could send crude lower this week

Published by , Editor
Oilfield Technology,


Jack Allardyce and Ashley Kelty, oil and gas research analysts at Cantor Fitzgerald Europe give their thoughts on the impact of rising US production.

“Benchmark crudes dropped sharply yesterday on worries about rising US production, amid softer global economic growth, particularly in China. Mining stocks also suffered after Vale stock fell 25% on the back of the dam disaster in Brazil.

“Elsewhere, the US imposed sanctions on Venezuelan NOC PDVSA in another attempt to force out Maduro, although while he still appears to have the support of the military leaders (for the moment), this could lead to further unrest if this changes. The other issue outstanding is a CITGO (PDVSA’s overseas arm) debt payment due in April, which if defaulted on, could see assets seized, depriving the country of valuable sources of revenue. New president elect Guaido is rushing to appoint new boards in an attempt to ensure payments are met and that revenue can come in.

“In the short term, this new batch of US sanctions will see supply from Venezuela tighten, although markets appear to view this as inconsequential compared to softening Asian demand. With several industrials reporting poor results – all blamed on a weaker Chinese economy , these fears may be justified. Focus will be intensifying on the US inventory data tomorrow, with expectations of a further build in stocks – a larger build will likely see crude taking a further step downwards.”

Read the article online at: https://www.oilfieldtechnology.com/special-reports/29012019/cantor-fitzgerald-us-inventory-builds-could-send-crude-lower-this-week/

You might also like

 
 

Embed article link: (copy the HTML code below):


 

This article has been tagged under the following:

Upstream news Oil & gas news