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By the Oil Risk Management Team at A/S Global Risk Management

Yesterday, news of Saudi Arabia being about to make a 'significant statement' made oil prices jump and Brent oil price increased $3 in two hours prior to the statement. As it turned out that the news would likely not mean a significant immediate output cut/freeze; prices quickly fell back a couple of dollars and at time of writing, Brent oil price is around $47.8.

The message from Saudi Arabia and Russia was that the two have signed a pact to cooperate on stabilising the oil market, setting up a task force to review oil market fundamentals. The findings of the task force will come up with recommended measures and actions to secure oil market stability.

Fires are sweeping through northern oil fields in Iraq, though many fires are shut, there seems to be still some burning. The area has seen heavy fighting between Iraqi military and ISIS militants, but has recently been retaken by the Iraqi military.

As yesterday was a U.S. holiday, the weekly oil inventory reports are one day delayed, i.e. the API report will be published tomorrow night, the official EIA report on Thursday afternoon.

Turning to economic data front, today sees Eurozone GDP, U.S. Services PMI and ISM Non-Manufacturing PMI.

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A/S Global Risk Management is a provider of customised hedging solutions for the management of price risk on fuel expenses. The company has offices in Denmark and Singapore. For further details about its risk management products and services, please call +45 88 38 00 00 or email hedging@global-riskmanagement.com.