Kremlin says Russian-Saudi Cooperation Has Stabilized Oil Markets
October 15, 2020
Monday of this week was Columbus Day, so the inventory reports are pushed back one day. The API came out last night and it said crude oil stocks were down 5.4 million barrels. Gasoline stocks were down 1.5 million and distillates were down 3.9 million barrels.
Bloomberg estimates for today’s DOE inventory report are calling crude stocks down 1.940 million, gasoline stocks down 1.284 million and distillates down 1.597 million barrels. If we do get across the board draw if should offer some support to prices but with more restriction due to COVID in Germany, France and United Kingdom demand will be impacted. These new restriction and rising cases of COVID have put selling pressure on price here to start this morning. Again, I know this is a broken record, but this market is still stuck in it ranges and after trading higher and testing the upside limits is now pulling back and testing the downside of the ranges
Average estimates for today’s propane inventory update are for a draw of 59,000 barrels. The five year average for this reporting week is a build of 1.103 million barrels.
Inventory draws should be supportive to prices, but they are coming off high stock levels and the growing concerns of more lockdowns and restrictions from COVID cutting into already weak demand.
The Kremlin said that Russian cooperation with Saudi Arabia had proven effective in the past to stabilize global oil markets. The comments , made by Kremlin spokesman, Dmitry Peskov, come a day after President Vladimir Putin held a phone call with Saudi Crown Prince Mohammed bin Salman in which they discussed their countries cooperation, including in the OPEC+ format.
US Treasury Secretary, Steven Mnuchin said getting a stimulus bill done before the November 3rd election would be “difficult.”
OPEC’s Secretary General, Mohammad Barkindo said that OPEC + will ensure oil prices do not plunge steeply. He expressed his opinion that demand is still depressed and not picking up as they had expected earlier in the year. Barkindo also said that we will see a strong rebound in GDP next year. We have no doubt a vaccine will be available next year.