The Brent oil price slumped again last night to $49.61 as I write and is not looking especially well. We’re back in a trading range from $47-50, it appears. I still expect US data to be supportive to prices but the mood is clearly bearish. Last night the IEA raised its oil demand forecast to five year highs but the market sank on supply concerns anyway, Forexlive has the summary:
- Forecasts 2015 oil demand growth +60bpd to 1.77m. 5 year high
- Cuts 2016 by 150kbpd to 1.21m
- Raises non-OPEC output by 150k for 2015 and 110k for 2016 on supply from Russia, Brazil and Canada
- Cuts 2016 OPEC demand (plus stocks) by 200k to 31.1m
- Says OPEC supply rose 90k in Sep to 31.72m. Iraq supply offset Saudi drop (-80k in Sep)
- Total OECD crude stocks rose 28.8m to 2.943bn in August
- Says marked slowdown in demand growth and extra Iran supply is likely to keep market oversupplied through 2016
Volatility is the byword to use now, even so it appears the bear market rally is done and dusted already.
