Oil prices likely to keeps its affair with bearish forces

13 January, 2016

Elsa Lignos, Senior Currency Strategist at RBC CM, notes that on Tuesday, Nigeria’s oil representative (and outgoing OPEC president) claimed that OPEC is considering an emergency meeting, perhaps as soon as next month. 

Key Quotes

“Oil tried to rally but investors have learned to discount individual members’ hopes. The strategy from the group as a whole has not changed—the UAE’s Energy Minister followed up the comments from Nigeria by saying, “I don’t think it’s fair to ask OPEC” to cut production in isolation, adding that their current strategy is “working”. 

Our energy analysts have cut their oil forecasts again (now looking for WTI to average USD40/bbl this year (prev USD52/bbl) and USD57/bbl in 2017. They argue that the rebalancing act still has a long way to go. Rapidly increasing market expectations of economic turmoil are outstripping the slow recalibration of global supply. 

Non-OPEC production remains resilient, Iranian production may come online more quickly than anticipated, and there are signs of tapering Chinese demand and what we see as weather-related softness in US demand. But they note that one of the biggest drivers of the price action is poor sentiment—managed money shorts remain near highs and open interest in lower strike put options continue to dominate. That means a near-term bearish outlook even as oil plumbs new lows.”


Source link  
Gold holds steady near 6-week highs

Gold trimmed of the early gains to a six-week high and retreated to the $1262 region during early the European session, albeit has managed to hold...

USD stays under pressure on politics

The US dollar inched up from a 13-month low against a basket of six major currencies touched in early trading, assisted by strongerthan-expected...

Dollar rebounds from multi-month lows

The greenback selling pressure seems to have abated for the time being, with the key US Dollar Index (DXY) bouncing off 9-month lows...


EUR/GBP jumps to fresh yearly tops

The EUR/GBP cross was seen building on previous session's strong up-move and has now jumped to fresh yearly tops near 0.8875...

USD: Fed being a little more hawkish

The dollar picked up over the past week, and this continued to be in reaction to a Fed that is being a little more hawkish...

EUR sluggish in recent weeks

EUR has also been surprisingly soft in light of the convincing win by French President Macron...


EUR/USD sinks to session lows

The single currency is now losing the grip vs. the buck, sending EUR/USD to test the area of daily lows in the 1.1240/30. Spot met extra downside pressure...

Euro is consolidating below the 1.1300

In view of Karen Jones, Head of FICC Technical Analysis at Commerzbank, the pair still points to some consolidation...

Dollar Index rebound looks plausible

In view of the analysts at Societe Generale, the Dollar Index correction appears to have come...

  


Share: