Oil prices erase all gains since Hamas attack

2023-10-12
Summary:

Oil prices extended its loss on Thursday after a drop of over 2% as Saudi Arabia pledged to help stabilise the market.

Oil prices extended its loss on Thursday after a drop of over 2% as Saudi Arabia pledged to help stabilise the market. Russian President Vladimir Putin said that OPEC+ will continue ‘for the predictability of the oil market."

New York Times reported US intelligence shows Iranian leaders were surprised by the Hamas attack in Israel, implying further sanctionsagainst Tehran is unlikely. There will not be supply disruption if the Islamic country is not involved.


US crude stocks swelled by about 12.9 million barrels, according to market sources citing American Petroleum Institute figures. This was much higher than the 500,000-barrel gain expected.


The IEA projected global oil inventories would fall by 200,000 bpd in the second half of 2023 from voluntary output cuts from Saudi Arabia.


US energy stocks saw net sales in the week ending October 6 for the second straight week in a row and in the eight previous trading sessions, according to a Goldman Sachs note. Hedge funds were clearly bearish before Hamas’ surprise attack.


Oil will continue to be a big area of focus after energy prices drove the bulk of August's price increases. Sep’s consumer prices due later today are closely watched by investors.

XBRUSD

Brent crude has reinforced expectations of downtrend after a strong rejection at the 50 EMA, exposing the recent low around 83.


Disclaimer: This material is for general information purposes only and is not intended as (and should not be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by EBC or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.

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