Fans of monetary stimulus always ignore the biggest and best push for the economy. Cheap energy. Finding oil and gas.
The United States have achieved an economic stimulus equivalent to 1.3% of GDP thanks to the energy revolution brought by fracking. It is a very significant positive effect, both on the supply and demand side. Continue reading The Oil Market Is Well Supplied. Thoughts for 2014
Oil still trending down ($106.8.0 Brent), WTI discount to Brent now at $12/bbl.I have been talking all month about the widening driven by tightness in Brent and ample supplies in US. Brent has stayed strong this week on the drying up of Libyan exports. No such supply issues in the US where crude stocks have risen well above the 5-yr range causing the Brent-WTI spread to widen abruptly. Continue reading Commodities Update
Oil is flat and looking at a weak short term trend sliding between $105-110/bbl Brent.
The short term palliative of a deal in Washington to temporarily address the debt ceiling and budget overcame the potential longer-term implications of reports of constructive dialogue between Iran and the global powers in Geneva which has the potential, given the US’ positive reaction, to see sanctions eased. Clearly there is a long way to go to get to something substantive and Iranian exports will not recover quickly but fall in Iranian’s exports has compensated for poor demand growth and strong US production growth.