Oil prices fell again

Last week oil prices fell again, WTI was down by $2.30 and Brent was off $2.14 only just keeping within trading ranges. With the NFP numbers being well higher than expected at 271/-, unemployment down to 5% and hourly earnings up 2.5% year on year, the greenback was only going one way, weakening the oil price.

The rig count, which showed an overall decline of 4 units and 6 in oil, was unlikely to impact such strength and at the weekend economic data from China also showed the different directions the biggest two economies in the world were headed. Crude oil imports in China in October were down 5.7% on September although this statistic is notoriously fickle and could easily reverse any time.

Other points to mention, in no particular order are as follows, the relentless supply of oil onto the market shows no sign of abating as confirmed, if any was needed, by the article on the front page of the FT about Saudi supplies. Interestingly the journalists on the story are tagged and include the paper’s Editor-in-Chief no less who is in Riyadh to help two other journos to write one small story… Elsewhere this week will see all three agencies produce their monthly reports and are unlikely to be anything but bearish although it was interesting to see speculative activity by hedgies and the like become more optimistic on Friday. Finally Barry vetoes the Keystone pipeline as expected on climate change grounds (not the 250bn miles a month that Americans drive then Baz?) as well as ruling out oil exports while he was about it.