Commentaries on Crude Oil

Fed chair J Powell decides to keep the interest rates unchanged. However, there is growing consensus of one more hike this year.

⚫⚪⚫

U.S. Crude oil inventory dropped. 

So, did the crude oil imports. 

⚫⚪⚫

Bank of America, Citigroup and Goldman Sachs are now all predicting US$100 Brent crude prices before 2024, as is Chevron CEO Mike Wirth, according to a Bloomberg report.

⚫⚪⚫

"We're chewing on this right now," said Andrew Botterill of Deloitte Canada, in an interview Wednesday in Calgary, where hundreds of oil and gas executives from around the globe are gathered this week for the 24th World Petroleum Congress.

Botterill said he's currently working on Deloitte's upcoming oil price forecast report and considering whether to revise his own earlier projections higher. "I can absolutely see it ($100 oil) ... I absolutely think we will have moments," Botterill said. "I can list a lot more reasons why oil will move up right now than down."

⚫⚪⚫

Traders locked in profits following a 10% gain in prices since the start of the month, ANZ Bank said.

Despite the small inventory draw, concerns remain that ongoing US inventory declines could cause storage facilities to reach their operational minimum, according to ANZ Bank.

⚫⚪⚫

Job data are coming strong week on week. Shows that economy is resilient. 

⚫⚪⚫

U.S. Philadelphia Fed Manufacturing Data fell sharply. 

⚫⚪⚫

"Crude oil traders focus on consolidation has been strengthened by the higher-for-longer message signalled by the FOMC dot plot, but while it may raise some demand concerns for 2024, the short-term outlook points to continued tightness. For now, the stronger dollar and reduced risk appetite may see Brent trade lower towards 90.60 and WTI towards 87.50," Saxo Bank noted.

⚫⚪⚫

Crude oil prices could spike to above $100 per barrel in the run up to winter, Bjoern Jesch, global chief investment officer at DWS Group told Reuters.

"When you ask me about risk scenarios, there is high momentum in energy prices and what I do see as the risk, is that moving more to the colder months, probably there is an escalation," Jesch, who oversees investments at the DWS Group.

"I do see definitely a risk of spiking energy prices maybe over $100 for a short period of time." The speed of the recent gains also gave cause for concern said Madeleine Ronner, portfolio manager at DWS, leaving economies little time to adjust, especially in a scenario where the momentum was supply driven, as it is now.

"If it's a slow increase, it's much better, but if it happens as fast as it happens now, that's more problematic," Ronner said.

⚫⚪⚫