Malcolm Graham-Wood
Independent Analyst
Last month was not pleasant for the oil price, WTI lost $12.35 or 20.8% of its value whilst Brent shed $11.38 or 17.9%. All the problems have been well documented here and elsewhere but Reuters have confirmed my thoughts that Opec produced 32m b/d in the month, up 140/- b/d. A combination of factors led mainly by countries getting in before the Iranian crude supplies kick in were responsible. Over the weekend the Iranian oil Minister again suggested that they would export around 500/- b/d more as soon as sanctions are lifted and 1m b/d ‘within months’ of that date.
Other factors include a continued sell-off by hedge funds and other traders, particularly in WTI which might explain the monthly fall as exposure to that marker halved on the month to 105,199 lots which is a five year low. Finally on Friday the rig count showed an overall fall of two units to 874 but in oil the number was up by 5 to 664 rigs.
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