White House Advisor Navarro Casts Doubt on US-China Trade Deal
June 23rd, 2020
The outlook remains positive and there’s data that continues to keep energy prices on track to move higher. The reports I’m seeing show supplies are tightening, but I still struggle with the numbers that show a glut of stocks in the United States. Price were higher yesterday as global oil demand remains on the rise. The OPEC+ production cuts appear to be working. The number of oil rigs in the United States also continues to decline.
Even with COVID-19 cases on the rise, the keeps moving higher on the expectation that businesses are returning to a semblance of normalcy. Many energy experts believe most of the world’s governments and most U.S. states will not shut down economies again due to increases in the coronavirus.
News Drives Markets
In today’s world, all markets react quickly to the news. It is a new world of instant information and the markets have adapted. Bloomberg reports U.S. equity futures and Treasury yields briefly plunged last night. White House adviser Peter Navarro said the US-China trade deal was over during an appearance on Fox News, which created the panic. President Donald Trump tweeted that the agreement was “fully intact,” and the market quickly recovered. Navarro said his comments were taken “wildly out of context.” Michael Every, a global strategist at Rabobank, says the whipsawed markets are a taste of things to come. He sees no way that China can stick to the terms of the agreement.
Bank of America revised up its WTUI crude oil forecast for 2020 up to $39.70 per barrel yesterday. Bank of America also raised its Brent oil forecast up to $43.70 per barrel for 2020 up to $50 for 2021 and up to $55 for 2022.
Genscape reports that crude oil stocks held in Cushing, Oklahoma in the week ending Friday, June 19, fell by 3,621,592 barrels on the week.