• 33 mins Syrian Rebel Group Takes Over Oil Field From IS
  • 3 days PDVSA Booted From Caribbean Terminal Over Unpaid Bills
  • 3 days Russia Warns Ukraine Against Recovering Oil Off The Coast Of Crimea
  • 3 days Syrian Rebels Relinquish Control Of Major Gas Field
  • 3 days Schlumberger Warns Of Moderating Investment In North America
  • 3 days Oil Prices Set For Weekly Loss As Profit Taking Trumps Mideast Tensions
  • 3 days Energy Regulators Look To Guard Grid From Cyberattacks
  • 3 days Mexico Says OPEC Has Not Approached It For Deal Extension
  • 3 days New Video Game Targets Oil Infrastructure
  • 3 days Shell Restarts Bonny Light Exports
  • 3 days Russia’s Rosneft To Take Majority In Kurdish Oil Pipeline
  • 3 days Iraq Struggles To Replace Damaged Kirkuk Equipment As Output Falls
  • 4 days British Utility Companies Brace For Major Reforms
  • 4 days Montenegro A ‘Sweet Spot’ Of Untapped Oil, Gas In The Adriatic
  • 4 days Rosneft CEO: Rising U.S. Shale A Downside Risk To Oil Prices
  • 4 days Brazil Could Invite More Bids For Unsold Pre-Salt Oil Blocks
  • 4 days OPEC/Non-OPEC Seek Consensus On Deal Before Nov Summit
  • 4 days London Stock Exchange Boss Defends Push To Win Aramco IPO
  • 4 days Rosneft Signs $400M Deal With Kurdistan
  • 4 days Kinder Morgan Warns About Trans Mountain Delays
  • 4 days India, China, U.S., Complain Of Venezuelan Crude Oil Quality Issues
  • 5 days Kurdish Kirkuk-Ceyhan Crude Oil Flows Plunge To 225,000 Bpd
  • 5 days Russia, Saudis Team Up To Boost Fracking Tech
  • 5 days Conflicting News Spurs Doubt On Aramco IPO
  • 5 days Exxon Starts Production At New Refinery In Texas
  • 5 days Iraq Asks BP To Redevelop Kirkuk Oil Fields
  • 6 days Oil Prices Rise After U.S. API Reports Strong Crude Inventory Draw
  • 6 days Oil Gains Spur Growth In Canada’s Oil Cities
  • 6 days China To Take 5% Of Rosneft’s Output In New Deal
  • 6 days UAE Oil Giant Seeks Partnership For Possible IPO
  • 6 days Planting Trees Could Cut Emissions As Much As Quitting Oil
  • 6 days VW Fails To Secure Critical Commodity For EVs
  • 6 days Enbridge Pipeline Expansion Finally Approved
  • 6 days Iraqi Forces Seize Control Of North Oil Co Fields In Kirkuk
  • 6 days OPEC Oil Deal Compliance Falls To 86%
  • 7 days U.S. Oil Production To Increase in November As Rig Count Falls
  • 7 days Gazprom Neft Unhappy With OPEC-Russia Production Cut Deal
  • 7 days Disputed Venezuelan Vote Could Lead To More Sanctions, Clashes
  • 7 days EU Urges U.S. Congress To Protect Iran Nuclear Deal
  • 7 days Oil Rig Explosion In Louisiana Leaves 7 Injured, 1 Still Missing
Alt Text

Why Petrol Powered Cars Aren’t Going Anywhere

Internal combustion engines are still…

Alt Text

China Takes Aim At The Petrodollar

In a potentially disrupting move…

Alt Text

Aggressive OPEC Pushes Oil Prices Up

Oil prices are once again…

Matt Smith

Matt Smith

Taking a voyage across the world of energy with ClipperData’s Director of Commodity Research. Follow on Twitter @ClipperData, @mattvsmith01

More Info

Oil Sinks Back After Key OPEC Members Turn Down Invitation For Doha Meeting

Fracking rig

Oil rallied this morning for a second consecutive day, despite a bearish-tilted EIA report. But fell in the late morning as more weight is placed on behind-the-scenes OPEC meetings, financial positioning however is shifting bullish once more. Hark, here are six things to consider in oil markets today.

1) While it seems beyond the realm of possibility that the President-elect will follow through on his threats to ban Saudi crude imports to the U.S. (the kingdom is, after all, the second-largest supplier of crude to the U.S. after Canada), there is also anxiety mounting in other OPEC countries who supply black gold, Texas tea to the U.S.

Donald Trump's threat to 'become independent of any need to import energy from the OPEC cartel' has Nigeria concerned about its trade relations; the U.S. is the largest foreign investor in Nigeria.

As the lifting of the U.S. export ban has brought WTI back in line with other global benchmarks such as Brent, and as U.S. production has dropped off - and particularly the transit of crude-by-rail to the East coast - Nigerian oil deliveries to the U.S. have climbed to over 200,000 bpd this year.

Imports have more than tripled from 2015 levels, despite violence and sabotage disrupting domestic production in the West African nation this year. Indeed, imports in recent months would likely have been higher if it had not been for this - and could be lower going forward. The vast majority of Nigerian crude is discharged on the East coast:

(Click to enlarge)

2) This Bloomberg article includes our insights into the U.S. gasoline market, and how exports have ramped up in recent weeks. The increase has been in response to the Colonial pipeline outage, meaning gasoline has been stranded on the Gulf coast.

As Gulf coast inventories have hockey-sticked higher (hark, below), some of this excess has been siphoned off, with exports climbing above 1mn bpd in the weeks following the outage. Although not quite yet through the current week, our ClipperData illustrate (at right) another strong week of exports is on the cards.

3) A triumvirate of builds from today's EIA inventory report is tilted bearish for the crude complex; a firm 5.3 million barrel build to crude stocks was due to a strong rebound in imports. Refinery runs also showed a healthy increase, meaning builds to both gasoline and distillates. The overall theme of this report is that of healthy supply: in terms of oil imports, refinery runs, and inventories. Related: Trump Considers Oil Tycoon Harold Hamm for Energy Dept.

Above we discussed how gasoline exports have been extremely strong from the U.S. Gulf. This is underscored by a draw to gasoline inventories for PADD3 in this week's report. Even though refinery runs increased by 297,000 bpd, or 3.4 percent, gasoline inventories still fell by 0.4 million barrels. Nonetheless, gasoline inventories at 82.2mn bbls are still over 7mn bbls higher - or 9.5 percent higher - than last year's level.

(Click to enlarge)

4) The IEA today has released its World Energy Outlook, which takes a look at broader, longer-term trends for global energy supply and demand. Its main scenario projects a 30 percent rise in global energy demand by 2040.

Focusing on the oil market, the IEA expects oil consumption to still be at 103mn bpd by 2040 . Similar to OPEC's World Oil Outlook last week, the agency sees OECD oil demand dropping significantly (down 12mn bpd by 2040), but is more than offset by non-OECD demand growth, led by India.

One big change highlighted in the report relates to fossil fuel subsidies. They dropped last year substantially to $325 billion, from $500 billion in the year prior. This was driven by key petro-states unwinding fuel subsidies amid lower oil prices. Related: Is GE Looking To Exit Oilfield Services?

Even with the pledges in the Paris climate accord, 74 percent of total global energy will come from fossil fuels in 2040, down 8 percent from 81 percent in 2014:

(Click to enlarge)

5) As the chart below illustrates, there were a record number of WTI call options purchased yesterday on the CME, as hedge funds and other speculators position themselves ahead of a potential OPEC production cut at the end of the month.

The volume reached the equivalent of 303mn bbls, surpassing the previous record in 2011 of 221mn bbls.

(Click to enlarge)

6) Finally, the U.S. Geological Survey released a report yesterday which said part of the Permian Basin, the Wolfcamp formation, could hold as much as 20 billion barrels of crude - three times the size of the Bakken. Companies such as Concho Resources Inc. say two recently drilled wells are producing an average of 2,000 bpd. The report also estimates that Wolfcamp holds 15 Tcf of natural gas, and 1.6 billion barrels of natural gas liquids.

By Matt Smith

More Top Reads From Oilprice.com:

Back to homepage

Leave a comment
  • Kr55 on November 16 2016 said:
    Any particular reason you have nothing in your article relating to the title? Assume it is about Iran having their OPEC governor represent them instead of the oil minster?
  • GregSS on November 16 2016 said:
    Trump claims to want to be independent of OPEC oil. To do that, he'll either need to ramp up domestic product which will be hard given current prices. or encourage alternative energy which he does not seem to be a fan of. Will be interesting to see how this plays out.
  • Craig Woerpel on November 16 2016 said:
    GregSS: A ban on OPEC oil imports, a tariff, or just the threat of a tariff would raise prices and boost domestic production. Have you not considered these options, because I'm sure Trump has?

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News