The move lower in oil prices continued yesterday, and given the updated EIA report on the global balance, one might be perplexed as to why daily losses in WTI and Brent amounted to a mere 60 cents/bbl. We will take a deep dive into the numbers after OPEC and the IEA release their own findings tomorrow.
For our oil market at least, it seems as if there is a conspiracy in events to keep us in a quiet range. The United Kingdom hosted Germany, France (coined E3 after being so named in the Iran nuclear deal) and Ukraine in what was hailed as a show of solidarity for President Volodymyr Zelenskyy. To cast a commercial and possibly cynical eye over the proceedings in London yesterday, and further meetings in Europe today involving Zelenskyy, one wonders what has been achieved other than adding more intrigue.
The weekly trading ranges in the two main crude oil futures contracts inaccurately indicate an uneventful period, with prices struggling for direction. WTI moved in a $2.22/bbl range, whilst its European peer managed an even narrower band of $1.92/bbl. The structure at the front, whilst not exactly telling the story of a tight underlying oil balance, remained solid.
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