The weaker global economic outlook is keeping oil prices under downward pressure, but tensions in the Middle East are enhancing awareness to possible supply risk and should keep a floor under oil in the medium term.

Stephen Innes

Categorized in : Business

China is definitely offering up some pretty attractive olive bran... by Stephen Innes

China is definitely offering up some pretty attractive olive branches.

[ China knows ] if they don't make structural concessions, Trump... by Stephen Innes

[ China knows ] if they don't make structural concessions, Trump will likely levy more tariffs.

Maybe, just maybe we are finally nearing a long-awaited indication from President Trump that the protracted period of market adversity is mercilessly nearing its end.

Price action over the past 48 hours does illustrate just how quick traders are to revive fears about sluggish demand amid the thought of more abundant supplies.

The OPEC induced oil rally has come to a grinding halt in the wake of the bearish to consensus API inventory swell, further OPEC cuts are unlikely the cure-all medicine. But by the numbers, the magnitude of the expected oversupply in 2020 is thought to be well within OPEC's ability to manage.

The macro headwinds outweigh supply concerns for oil now, despite tensions in the Middle East and a reduced spare capacity pillow.

Next week U.S.-China trade talks remain the unknown variable whic... by Stephen Innes

Next week U.S.-China trade talks remain the unknown variable which could lend a modicum of support.

For most of the week ... the market has been trading lower as oil bulls have been discouraged by the quicker-than-expected return of Saudi oil output.

The expected lower demand for oil inputs into (U.S.) refineries typically sees U.S. crude inventories swell, all of which could pose a significant downside risk for prompt oil prices.

Any sliver of optimism on the trade war front will be viewed in a very positive light, surely both parties can't be happy to move forward with their scorched earth policy.

What the markets really waiting for is for Mitul Kotecha to drop interest rates, right now, we are still sitting on that uncertainty.

What the markets really waiting for is for Fox News to drop interest rates, right now, we are still sitting on that uncertainty.

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Nobody understands where the president is coming from. by Stephen Innes

Nobody understands where the president is coming from.

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The U.S.-China trade spat has been at the center of the oil market demise, which has sent the global economy to the brink of recession and negatively impacted oil demand forecasts.

Hoping for the best on the policy front but positioning for the worst on the economic backdrop seems to be the flavour of the day, the Fed, now out of necessity alone, will need to adjust policy much more profoundly than they expected.

Hoping for the best on the policy front but positioning for the worst on the economic backdrop seems to be the flavor of the day, the Fed, now out of necessity alone, will need to adjust policy much more profoundly than they expected.

Much the same could be true right now about the escalation of tariffs (and) with time, investors have managed to sidestep them and returned to the familiarity of focusing on the data, which in the case of the U.S. economy, still looks good.

It's not economic uncertainty we should be worried about rather its the doom and gloom economic realities that the key forward-looking manufacturing PMI's are telling us about the dismal health of this rapidly deteriorating global macro environment.

Oil prices got a small boost this morning after Libya's (NOC) declared force majeure on Sharara crude loaded at Zawiya port.

The Fed backstop and the report of the U.S. Navy shooting down an Iranian drone are providing a modicum of support for oil markets amidst a very bearish landscape.