Malcolm Graham-Wood
Independent Analyst
The oil price was up strongly last week, WTI rose $2.19 and Brent $3.02 before expiry, today they have both settled down as news is for choice, not brilliant. Having said that the fundamentals are still looking obstinately bearish, last week’s EIA stats showed a 2m build and 1.7m at Cushing and today Reuters is reporting that April Opec production is at record highs , up 170/- b/d at 32.64m b/d. There is a lot of crude from various parts of the world looking for a home and I read at the weekend that Ian Taylor the highly respected boss of Vitol reckons that the Chinese have completed their latest batch of buying for strategic reserves. One more bullish stat was that yet again the rig count showed new lows being reached as overall the number of units was down 11 at 420 and the same number in oil to 332. So it seems that those looking forward are seeing into 2017, with a significant diminution in non-Opec supplies combined with nearly $500bn off capex leading to a re-balancing of supply and demand, those looking at the present see no sign to the end of what is still very definitely a glut, there may be trouble ahead.
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