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Trends

Rotterdam: $ 2 lower
Singapore: $ 6 lower
US Gulf: $ 1 lower

Slow news day (Brent: $104.2)

Little news is out that could affect the oil market. Some better-than-expected job numbers from the U.S (342,000 jobless claims vs 360,000 expected) casued some minor jitters which was quickly absorbed by the market. Later today, (14.30 CET) inflation figures and retail sales will be available, but we do not expect any major volatility around it.

After OPEC cut the demand outlook earlier this week to 800,000 bpd, the International Energy Agency (IEA) also published a lower view on demand growth for 2013. With a view of demand growth at 795,000 bpd, IEA and OPEC are very much in line. The increase in demand should be covered relatively easy by shale oil and the spare capacity of Saudi Arabia.

Recommendation

We highly recommend consumers to keep an eye out for a sharp upwards move the coming weeks. With the recent drop in oil prices over the past days, the divergence has continued to increase. History tells us that the divergence in the financial markets should not be ignored! When the spread equities-Brent corrects it will be a major move in a short time span. The two geopolitical wildcards Venezuela an Iran could be the trigger for rising oil prices.