OPEC Monthly Oil Market Report (Oct.)

OPEC moved closer to its collective target output last month. However, it is now clear that if the group were to answer calls to raise output, it would involve abandoning the current quota system and allowing a few producers with available capacity to produce more.
Caroline Bain Chief Commodities Economist
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Energy Update

Revisiting our oil market outlook

Omicron will weigh on jet fuel demand in the next few months, but the wider hit to demand is still unclear. And although OPEC+ decided to push ahead with its planned oil production increases, we think it will struggle to raise output by as much as planned next year. So, for now, we are leaving our end-2022 oil price forecasts unchanged, but downside risk has risen due to the threat to demand.

3 December 2021

Energy Data Response

US Weekly Petroleum Status Report

US commercial stocks fell as, despite some chunky falls in product demand, US demand is still outstripping supply. Although, the release did shows signs that crude production might finally be responding to higher prices.

1 December 2021

Energy Update

Strategic release of reserves is too little too late

The announcement of the co-ordinated release of oil reserves by the US and other large oil consumers should mean higher supply (and downward pressure on prices) but it will come at a time when we expect that the market will be in a surplus anyway. What’s more, the big risk is that the release prompts OPEC+ to slow or halt its output rises.

25 November 2021

More from Caroline Bain

Commodities Weekly Wrap

Energy price rally maybe running out of steam

Commodity prices generally rose this week, helped by the US senate approving a deal to increase the federal debt ceiling. After a rollercoaster of a week, European natural gas prices ended the week lower following comments from President Putin that Russia was prepared to stabilise global energy prices by boosting supply. Nevertheless, we continue to expect most energy prices to remain high until at least Q2 2022. It was a quiet week for metals markets, although most prices rose on Friday as Chinese traders returned from the national ‘Golden Week’ holiday. The main data release for commodity markets next week will be the China trade data for September (Wednesday). We suspect that China’s imports of industrial metals will have edged lower in tandem with weaker construction activity, but imports of coal are likely to have risen in response to ongoing power shortages.

Watch out for our Group Chief Economist, Neil Shearing, who will be presenting the Economic keynote at the LME Metals Seminar on Monday 11th October. If you would like copies of the slides, please email caroline.bain@capitaleconomics.com

8 October 2021

Energy Update

Natural gas prices now untenably high

The price of European natural gas (TTF) surged by around 35% this morning, before crashing back down on Putin’s reassuring comments about Russian supply. The latest price moves appear speculative, and we retain our view that it is just a matter of time before supply and demand adjust to bring prices back down.

6 October 2021

Energy Watch

Latest natural gas price surge will unwind

At the time of writing, global natural gas prices are soaring. Dramatic moves in global natural gas prices are nothing new and not even very surprising given the extreme weather over the past year or so. In this Energy Watch, we consider earlier spikes in natural gas prices and discuss whether this time is different.

In view of the wider interest, we are also sending this Energy Watch to clients of our Commodities Overview service.

1 October 2021
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