Most of the damage is in Corpus Christi with 4 refineries hit. The likely impacts could be similar to what we saw with an earlier tropical storm which was a net drawdown. Houston has the problem this time with torrential rain. Hurricane season has 10 weeks to go but early September tends to be peak time.
The focus now is becoming more on the Opec compliance rates and global growth.
The effect of disrupted shipping will be exactly opposite to what it used to be in pre-shale days. US exports oil these days. A disruption could well see US inventories running high. That will mean lower oil price for some time. What will that do to TLW SP?
Down 4 rigs this week. With more restrictions on Venezuela to boot from USA it just requires patience. The price has been in the 160's before when gold was above 52.2 on Brent but as Brummell points out they are keeping things bottled for the time being. Most E&Ps were blocked from a rally today. An oil seller somewhere filled the gap this time round.
Enjoy bank hols in the UK or abroad if that is where you happen to be. Just hope none of you are in Texas.
For some reason the market took last week's rig count slight fall as the start of a downward trend. Any pullback this week on rig count numbers should have a greater affect...Rig count numbers out at 18:00
Tony, on any other day you could well have been right but the price is nearly always under pressure on Fridays. Imho that is because the short interested traders want to minimise the effect of good news or exaggerate the effect of good news over the weekend. Particularly significant on a Bank Holiday weekend.
That could well be a mistake this weekend though. The news from Hurricane Harvey seems to be getting worse by the minute. The hurricane threatens something like 45% of the US oil refinery capacity. At the very least it is expected to reduce that "glut" of crude:
"Houston-based energy bank Tudor Pickering Holt & Co said in a research note not to expect significant nor lasting production impacts from Harvey. But it said it would impact some production and disrupt refinery runs, imports and exports, "which will show up in the weekly inventory numbers for the next few weeks." "
"The storm could also bring flooding to shale oil fields in southern Texas that produce more than one million barrels of oil a day. "
It could also affect plans to use the US emergency crude reserves in the oil price war:
"The stockpiles in the Strategic Petroleum Reserve were last used in 2012, after Tropical Storm Isaac shut down 95 percent of oil output in the Gulf and hit Louisiana. The government has not yet said if it plans to use the reserve after Harvey. "
The tropical storm is now a hurricane with winds above 100mph. USA production likely to be affected as the pathway now likely to affect a number of states. Oil has now bounced back in price as the conditions in the Gulf of Mexico get worse. Tullow should go back up tomorrow. If so 155.1p could be the higher low.
TT, it'll be interesting to find out what happens. I still have 129/130 in the back of my mind so won't over-load here. I'm also not in a rush. I'll drop 33-66% of what I have on a rise if there seems to be an important decision point. But I'm not watching that closely, to be honest.
My analysis is a little different from yours. I have the next cycle low around 152p as a higher low. I believe we are forming an upper pennant for a future breakout upwards but it make take two or three weeks to set up. The upside you suggest is probably right on the chart TA although we could see an intra-day peak around 205p and a sharp pull back.
BuySel, it's not a very convincing tl in my view. There's only 1 touch at the top. For me 2 touches is weak, but gives you something to look forward to, 3 makes a tl. I know others have other views. The cross of the MA's is more interesting, as is the widening megaphone pattern developing from June 23rd. A 3rd touch of the megaphone lower line around 150 would confirm the pattern (as we already have 3 touches of the upper limit), if that broke, the longer term tl is currently 145 area and rising every day. In order to test the upside of the pattern, the price needs 195 or so currently (rising every day).
Crude 3.6B drawn but distillates and petroleum roughly the same up in the other direction. Official data out later but unlikely to give favours today. We may get better numbers next week but need USA to level off its output.
Another leaver from today's list of declarable short positions. Citadel have been steadily dropping over the past few weeks and were down to 0.59% on Friday have now left the list. That brings the total down to 10.40% and 7 declarations.
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