Daily oil and LNG price update (OPEC glut)

Tuesday, 18 October 2016

The Brent oil price fell last night to $51.51. Henry Hub gas followed to $3.24mmBtu:

The major oil story of the night is just how much OPEC is ready to pump (as opposed to cut). Nigeria is forecasting 2.2mmb/d by year end. Libya is forecasting 900mmb/d by year end. Iran is forecasting 4mmb/d by year-end and 5mmb/d within two years. Iraq and Venezula are claiming 500mmb/d more than OPEC estimates their output.

In other words, the OPEC production outlook is currently for 1.8mmb/d above where it was when the supposed cut was agreed. Add stabilising US production and we’re above 2mmb/d.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.