Crude Oil gained 11 points in the Asian session and held the gains for the balance of the day as traders monitor the production situation in Canada as
Crude Oil gained 11 points in the Asian session and held the gains for the balance of the day as traders monitor the production situation in Canada as field workers returned after the recent wild fire. WTI is trading at 49.44 while Brent Oil dipped 35 cents to 50.01 as traders sold off to book profits ahead of the June 2nd meeting. Once oil broke the $50 level traders began selling as production in Nigeria is expected to restart and Russia is hitting its highest production level in months. Crude prices briefly topped the psychological $50 a barrel last week for the first time this year as production disruptions in Canada and Nigeria eased short-term concerns about abundant global supplies.
But prices remain less than half of their 2014 peaks due to a glut of world supplies that experts predict could last for years.
The recovery in the oil price to around $50 has eased pressure on OPEC to turn down the taps when it gathers in Vienna on Thursday for its first meeting with the powerful Saudi crown prince’s new oil minister. “The general consensus is that there will be no agreement to establish quotas or lower production,” said James Williams at WTRG Economics.
“The most restrictive outcome might be an agreement to a production ceiling.”
Historically the Organization of the Petroleum Exporting Countries, which pumps around a third of the world’s oil or some 30 million barrels every day, has responded to a fall in prices by cutting production.
But in the current cycle, which saw prices collapse from over $100 in 2014 to close to $25 this January, producers led by kingpin Saudi Arabia have changed strategy, maintaining output even with lower prices.
The aim, experts say, was to keep hold of market share by seeking to put competitors that need a higher oil price than the Gulf states to make money — particularly US shale oil producers — out of business.
And even though it has taken a while, straining even Saudi Arabia’s public finances — to say nothing of struggling OPEC member Nigeria and on-the-brink Venezuela — Riyadh’s approach now looks to be bearing fruit, experts say.
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Upcoming Economic Events that you should be monitoring:
Wednesday, June 1, 2016
Cur. | Event | Actual | Forecast | Previous | |||
CNY | Manufacturing PMI (May) | 50.0 | 50.1 | ||||
CNY | Non-Manufacturing PMI (May) | 53.5 | |||||
AUD | GDP (QoQ) (Q1) | 0.6% | 0.6% | ||||
AUD | GDP (YoY) (Q1) | 2.7% | 3.0% | ||||
CNY | Caixin Manufacturing PMI (May) | 49.3 | 49.4 | ||||
GBP | Nationwide HPI (YoY) (May) | 4.6% | 4.9% | ||||
GBP | Nationwide HPI (MoM) (May) | 0.2% | 0.2% | ||||
EUR | Manufacturing PMI (May) | 51.5 | 51.5 | ||||
GBP | Manufacturing PMI (May) | 49.6 | 49.2 | ||||
USD | Manufacturing PMI (May) | 50.5 | 50.5 | ||||
USD | ISM Manufacturing Employment | 49.8 | 49.2 | ||||
USD | ISM Manufacturing PMI (May) | 50.5 | 50.8 | ||||
NZD | GlobalDairyTrade Price Index | 2.6% | |||||
USD | Beige Book |
Government Bond Auctions
Date Time Country Auction
May 30 11:10 Italy Eur 2-2.5bn 0.45% Jun 2021 BTP
Jun 01 10:30 Denmark Holds bond auction
Jun 01 11:30 Germany Eur 4bn 0% Apr 2021 Bobl
Jun 01 11:30 UK Gbp 2.75bn 1.5% 2021 Gilt
Jun 01 17:20 Sweden Announces details of bond auction on Jun 08
Jun 02 10:30 Spain Holds bond auction
Jun 02 10:50 France Eur 8-9bn 2.25% May 2024, 0.5% May 2026 & 3.25%
Jun 02 11:03 Sweden Sek 0.5bn 0.125% 2019 I/L & Sek 0.5bn 0.125% 2026 I/L bonds
Jun 06 13:00 Norway Details of bond auction on Jun 08
Jun 07 11:00 Netherlands Eur 4-6bn Jan 2022 DSL
Jun 07 11:00 Austria Holds bond auction
Jun 07 11:30 Germany Holds I/L bond auction
Jun 07 11:30 UK 4.5% 2046 Gilt
Jun 08 11:03 Sweden Holds bond auction
Jun 08 11:05 Norway Holds bond auction
Jun 08 11:30 Germany Eur 5bn Jun 2018 Schatz
Jun 08 17:20 Italy Announces details of bond auction
Jun 09 11:30 UK 0.125% 2036 I/L Gilt
Jun 09 17:20 Sweden Announces details of I/L auction on Jun 16