Job Numbers Look Bearish
February 8, 2021
The Baker Hughes Rig Count on Friday had oil rigs up 4 to 299 rigs. Last year at this time there were 676 oil rigs a difference of 377 rigs. Oil rigs have risen by 119 rigs since August of 2020.
Crude oil and refined fuels products closed at 1 year highs on Friday, which was mainly due to news that the US Senate passed a budget reconciliation along party lines after Vice President Harris cast the tie breaking vote.
The market continues to look at more economic stimulus from the government and the vaccines as factors that are helping to restore economic activities to normal which in turn will increase energy demand. The funds continue to push energy prices also as they see environmental regulations from the Biden administration making crude production harder and costlier. These outlook have pushed energy prices higher as they have recovered substantially from the lows put in in the early days of the coronavirus outbreak.
Bearish for energy price was the US Bureau of Labor Statistics (BLS) report that only 49,000 new jobs were created in January which was near economist expectations but a very low number. The BLS also revised the December job losses by 87,000 to a loss of 227,000 jobs.
President Biden over the weekend said that the US will not lift sanctions on Iran in order to get the country back to the negotiating table. He said that sanctions would only be lifted if Tehran stops enriching uranium. So, this means Iran barrels will not be back on the market anytime soon offering some support to crude prices.