IEA released their latest demand forecast, revised down 1M b/d to a forecasted year on year decline of approx. 0.6% in global demand. This is the first projected year on year demand contraction since 1982-83. Weak demand and poor economics has put more pressure on today's price. Highlights of the latest OMR
There is another piece to this though. The current WTI pricing and its dis-relation to Brent is confusing some. The spread between Nymex WTI and Brent is considerable putting this pricing system in disrepute. The discrepancy appears to be a function of storage levels (i.e., 33m bbl) at Cushing, the delivery point for WTI, and not of weakness in fundamental demand. This has wreaked havoc to some commodities traders. Gap between WTI and Brent raises questions
UPDATE1: and from EconomPic Data Oil Tankers are a Banks Best Friend Their theory is oil producing countries NEED money (budgets were based on $60, not $30 oil) so are willing to sell at whatever the current market price is. And speculators / arbitragers are willing to buy at this price knowing they can sell for a higher amount in the futures market and deliver that oil when / if necessary. This tells them that there is actually artificial demand even at these low prices (from those storing vs. those using the oil) and prices can / will go even lower once storage capacity is completely filled as the market becomes flooded with this stored oil.
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