Crude Oil On 3/19/19

TL;DR

Despite concerns over non-OPEC supply and decreasing Chinese GDP growth, the oil price is steady and OPEC is committed to maintaining production cuts.

Transcript

hey good morning I'm Malcolm Graham would that right mouse keys blog which is an a daily analysis of the oil and gas sector internationally talk about the our price and stocks as well we come at a time when the oil prices in is in pretty good Nick as I speak West Texas it's fifty nine fifty and Brent is sixty eight don't so it's firmed up quite nic... Read More

Key Insights

• 💇 OPEC+ has successfully stabilized oil prices through production cuts.
• 🗯️ The US is still a major player in non-OPEC oil supply, but with decreasing growth forecasts and rig counts.
• 🇮🇷 Concerns remain regarding supply issues in Venezuela, Iran, and Libya.
• 🥺 Overall global demand for oil is strong, with India leading the way.
• 🧑‍🏭 Chinese GDP growth and international economic indicators are crucial factors in assessing future oil demand.
• 😮 Gasoline prices rising in the US indicate increased demand.
• 😑 OPEC+ is taking a cautious approach, canceling the April meeting but expressing potential for further cuts in the future.

Questions & Answers

Q: What has been the main reason for the recent increase in oil prices?

The increase in oil prices is mainly attributed to OPEC+’s commitment to cutting back production. With the falling Iranian and Venezuelan oil supply, they realized they could produce more and still maintain a tight oil market.

Q: Will OPEC+ increase production in the future?

OPEC+ has expressed their commitment to maintain the current supply cut of 1.2 million barrels a day. The Saudis suggest that this cut may remain in place for the rest of the year, with potential for further cuts later on.

Q: How are non-OPEC supplies affecting the oil market?

Non-OPEC supplies, particularly in the US, have been a concern. However, the EIA has slightly reduced its growth forecast for US production, and the rig count is also decreasing. While non-OPEC supplies continue to pose a problem, OPEC's production control efforts have helped manage the situation.

Q: What is the current state of global oil demand?

Global oil demand remains substantial, with strong demand from India and overall positive economic indicators. Although Chinese GDP growth has slowed down, other countries, including the US, are showing signs of increasing demand. Gasoline prices are rising, indicating improving demand.

Summary & Key Takeaways

• Oil prices have firmed up recently, with West Texas at $59.50 and Brent at $68.

• OPEC+ has continued to cut back production, which led to the fall in oil prices last year. Their commitment to production cuts has helped stabilize the oil price.

• The recent OPEC+ meeting resulted in the decision to keep the 1.2 million barrels a day supply cut in place, with the Saudis suggesting it may continue for the rest of the year. The next scheduled meeting will be in June.