Latest Market Commentary
February 18, 2020
Energy market were closed yesterday and have opened lower to start this day. The downside in the energy market is being helped by reports that Apple said it will miss revenue guidance for the March quarter due to the coronavirus. This is just one on a growing list of companies that will be impacted.
The World Health Organization said it is still too early to say if cases of the coronavirus are really on the decline.
OPEC+ has still been quiet on any plans to cut addition production in the wake of the coronavirus outbreak. Russia has been the one member a bit apprehensive about making an additional cuts. The news about Russia agreeing to cut additional barrel was good yesterday but OPEC’s delay in any announcement worries the market. We may just have to wait until the regular scheduled March meeting to find out what OPEC’s plans will be.
From John Kemp of Reuters. Hong Kong International Airport is the busiest air cargo hub in the world, handling trade between Asia, especially China, North America, Western Europe , Middle East and the rest of Asia. Freight volumes were down almost 11% in January compared with the same month a year earlier at 14% compared with January 2018. Freight movements have been hit by the US/China trade war, the general slowdown in global manufacturing, unrest in Hong Kong, and now coronavirus. The downturn is likely to be even worse in February as the epidemic shuts down much of China’s manufacturing industry.
Libya has had a blockade of its ports and oil fields since January 18th that is impacted their production, which is helping to take barrels off the market in the face of demand destruction by the coronavirus. Libya’s National Oil Company said production has fallen to just 135,745 bpd and the losses incurred have now added up to $1.7 billion since the blockade started.