Oil prices notched upwards yesterday; Brent just above $77

By A/S Global Risk Management.



Michael Poulson, Global Risk Management. Image credit: Global Risk Management


Updated on 31 May 2018 07:36 GMT

Oil prices took a notch upwards yesterday and at the time of writing Brent is just above $77

Russia's central bank yesterday commented on the oil price, stating that: "A significant factor for the Russian market remains the risk of a decline in oil prices, for instance in case of a further substantial increase in oil output by the United States"

The weekly oil stocks data from the American Petroleum Institute (API) yesterday showed a surprise increase in crude oil stocks of 1 mio. barrels yesterday. Now this afternoon's oil inventory report from the Energy Information Administration (EIA) will be followed closely for confirmation/deviation of the trend. Consensus is a build of 2.2 mio. barrels of crude.

The potential reimposing of sanctions against Iran is back in the limelight as Iran has approached OPEC to gain support against sanctions being reimposed by the U.S. The country also contradicted recent comments by Saudi Arabia and Russia that OPEC and non-OPEC could agree to boost output at the meeting on 22 June in Vienna. The parties in November 2016 agreed to cut production by 1.8 mio. barrels per day in a pact aimed at reducing global inventories and support oil prices.

Overnight Chinese Manufacturing and non-Manufacturing PMI data came out better than expected at 51.9 (51.4 previous) and 54.9 (54.8 previous) respectively. Later today, European inflation and U.S. housing data will be released.



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