Energy Market Rebounds on Fed News
November 3, 2023
The energy market rebounded in yesterday’s trading keeping WTI crude oil price above $80 dollar per barrel. Crude was supported by a big drop in the US dollar index after the Fed decided on 11/1/2023 to not raise interest rates.
There have not been any real big news headlines to move prices and the market continues to be stuck in its trading range with no clear trend. WTI crude oil prices are higher to start this morning and are testing upside resistance. WTI crude oil will need a strong up day today and finish to the week to leave the weekly chart pattern bullish. If the bulls cannot accomplish this then prices will likely come under selling pressure to start next week unless something major develops over the weekend.
A short-term diesel outlook from analysts at S&P Global Commodity Insights noted that setting aside the price shock of 2022 for all refined products in response to the Russian invasion of Ukraine, spot ULSD prices in the Midwest have reached 10-year highs, as distillate inventories in late September and early October fell rapidly helped by fall refinery maintenance and an active fall harvest season that got underway. They expected stocks draws will remain strong in the region through November and diesel prices will remain elevated.
A research report released by Bank of America Europe this week is forecasting global refining capacity will grow significantly over the next two years. The bank sees Crude Oil Distillation Unit growth to increase by 20% in 2024 by 1.45 million bpd and to increase by 2.35 million bpd in 2025.
The US non-farm payroll number released this morning was that 150,000 new jobs were created in October the Dow Jones consensus forecast was for 170,000 new jobs.
From Bloomberg. China’s Petro China is proposing to buy up to 8 million barrels a month of Venezuelan crude from state-run oil company PDVSA, according to four people familiar with the matter, hoping to resume a trade suspended four years ago by US sanctions.