Malcolm Graham-Wood
Independent Analyst
Today is Washington’s Birthday or Presidents Day, either way its a Federal holiday and most oil markets are closed. This maybe partly to do with the rally on Friday which cant be put down to fundamentals but short closing and avoiding leaving positions open for a long weekend it might. To put things into perspective, WTI rose by 12.31% on Friday which was the best one day move since February 2009 but still left the contract down 4.7% on the week.
There was a bit of further discussion about Opec cutting, following on from the UAE call I mentioned on Friday the Nigerian oil Minister said that ‘there was a growing consensus that a decision must be reached to end the global price rout’. All very well but no cigar, at least for the time being. This is especially true since Iran are pumping up the volume with shipments galore leaving port and ministers claiming that they are producing 1.3m b/d now and by the Iranian New Year, March 20th, will be up to 1.5m b/d. Their oil is now firmly priced to compete with that of Saudi Aramco, hardly compatible with ‘forgetting the past and having a new narrative’…
The Baker Hughes rig count offered more solace on Friday, overall the number was down 30 units to 541, with oil down 28 to 439, more than 600 rigs off last years peak.
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