Market Watchers Expect Hawkish Comments from Fed Chair on Friday
August 24, 2022
The API reported that crude stocks were down 5.6 million barrels, gasoline up 268,000 and distillates up 1.1 million barrels.
The average estimates for today’s DOE inventory update are for crude stocks to be down 1.961 million barrels, gasoline stocks down 2.046 million barrels, and distillate stocks up 359,000 barrels.
Nine OPEC sources stated that OPEC+ production cuts may not be imminent and would coincide with the return of Iran to the oil markets should it sign a nuclear deal with the West. Should sanctions be lifted Iran would need about a year and a half to reach full capacity of 4 million bpd. However, they could start selling more quickly with the barrels they have in storage. Eurasia Group said with an estimated 100 million barrels of crude and condensate in floating storage, more than 50 million barrels in domestic onshore storage and a reported 14 million to 15 million barrels in bonded storage in China, the ramp up in exports and production is likely to be as fast as, if not faster then, in 2015-2016.
Estimates for the propane inventory report are for stocks to build by 1.741 million barrels.
Federal Reserve Chair Jerome Powell is set to speak on Friday at the Jackson Hole symposium and the market expects him to have a hawkish slant to his comments.
Bloomberg reports some 20 million people in the US – about 1 in 6 American homes have fallen behind on their utility bills. It is, according to the National Energy Assistance Directors Association the most severe crisis the group has ever documented. Soaring natural gas and electricity prices is driving these issues and the situation is worst in Europe.