Oil Fundamental Forecast – May 20, 2016

Crude Oil gave back some of it gains to trade at 47.28 down by 91 cents while Brent Oil is down almost $1 at 47.94. The soaring US dollar is doing its share to weigh on oil prices as well as the skyrocketing inventory reported on Wednesday. The dollar was up on Thursday after soaring to multi-week highs in the previous session following the release of the Fed minutes. A stronger greenback makes dollar-denominated oil more expensive for holders of other currencies.

Last week, the International Energy Agency reported global crude oil supplies were gaining at a slower rate than previous year, while growth forecasts for demand were revised higher because of strong gains in China, India and Russian Federation.

Official data revealed that Saudi Arabia’s crude oil exports declined slightly to 7.541 million bpd during March. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 691,000 barrels per day.

The consensus for the API report later is a drawdown of 3 million barrels of crude and 1 million barrels of gasoline.

Distillate stockpiles USOILD=ECI, which include diesel and heating oil, fell 3.2 million barrels, versus expectations for a 642,000-barrel drop, the EIA data showed. These events have included unfortunate incidences, including the wildfires in Canada that have posed a major disruption to Canadian crude production, and have been further intensified by general slowdowns in output from several oil producers, most notably the USA, due primarily to the prolonged recent period of depressed crude oil prices.

Oil prices had surged in recent sessions as outages in Africa and Canada, economic woes among Latin American producers, and production declines in the U.S. propelled expectations of a smaller glut. In recent weeks, the ongoing wildfires in Canada and supply disruptions in Nigeria and Libya have taken at least 1 million barrels of oil offline each day. Fiscal distress in Venezuela is also posing challenges for its oil operations.

FxEmpire provides in-depth analysis for each asset we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports, which covers the current week and are published by Sunday before the new week begins. Daily we share any new events, forecasts or analysis that affect the current day. To achieve a full accurate understanding it is important that you study all of our data and analysis as a whole.

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This Week in Petroleum
Release Schedule: Wednesday @ 1:00 p.m. EST (schedule)

Gasoline and Diesel Fuel Update
Release Schedule: Monday between 4:00 and 5:00 p.m. EST (schedule)

Weekly Petroleum Status Report
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Upcoming Economic Events that you should be monitoring:

Friday, May 20, 2016

Government Bond Auctions

Date Time       Country           Auction

May 20 11:03 Sweden Sek 1.992bn 0.5% Jun 2017

May 23 N/A UK Syndicated tap of 0.125% I/L 2046 Gilt

May 23 11:03 Sweden Sek 1.25bn 0.125% Jun 2019 I/L bond

May 23 11:30 Germany Eur 1.5bn May 2017 Bubill

May 23 12:00 Norway Details of bond auction on May 25

May 23 17:20 Italy Details of Zero‐coupon/BTP€i auction

May 25 11:03 Sweden Holds bond auction

May 25 11:05 Norway Holds bond auction

May 25 11:30 Germany Eur 1bn 2.5% Jul 2044 Bund

May 26 11:10 Italy Announces details of bond auction

May 26 11:10 Italy Holds Zero‐coupon/BTP€i auction

May 26 17:20 Sweden Details of I/L auction on Jun 02