WisdomTree: Olieprijs daalt scherp door mogelijk overaanbod op oliemarkt

14 nov 2018

Hieronder volgt een commentaar in het Engels van Aneeka Gupta van WisdomTree op de olieprijs die vanmorgen scherp daalde.

Catching a falling knife

Oil prices have been caught off-guard by the swift turn of events. The unanticipated US concessions to 8 key importers of Iranian oil within 6 months coupled with sharply rising US oil production is increasing the likelihood of the oil market being oversupplied in the current quarter. The markets expected the US sanctions on Iranian oil exports in November to reduce oil supply significantly. However, the temporary concessions by the US for countries that take the lion’s share of Iranian oil exports has led to a mismanagement of expectations. Iranian oil exports could rise soon again.

In response OPEC led by Saudi Arabia intends to lower oil exports by 0.5mn bpd. At the OPEC-Non-OPEC Joint Ministerial Monitoring Committee (JMMC) meeting in Abu Dhabi over the weekend Saudi Energy minister Khalid Al-Falih set the tone for a need by OPEC+ to cut oil production by 1mn (bpd) from October levels. This is likely to put OPEC on a collision course with the US, evident from the recent tweet by US president Trump that OPEC should not cut oil production.

Today’s sharp oil price correction to the downside is reflective of investors trying to gauge political incentives rather than underlying fundamentals. We also expect investors are testing OPEC ahead of their meeting in Vienna on 6 December 2018. The front end of the oil curve has moved into mild contango reflecting the change in the short term supply situation, while the rest of the curve remains in backwardation.