Oil prices are responding positively to an extension of the current OPEC/Non-OPEC production deal, especially because Nigeria and Libya agreed to cap production, but a monthly report by the Energy Information Administration (EIA) on U.S. production rising over 3% to 9.48 million barrels a day seemed to put a bit of a wet blanket on the markets' enthusiasm. Not to mention a million barrels of hedged shale oil output.
The Energy Information Administration (EIA) reported a more supportive snapshot of petroleum supply and demand that the American Petroleum Institute (API) reported, and while the report was not as bullish as pre-API report expectations from a seasonal standpoint it was supportive.
It seems the move by Saudi Arabia’s Crown Prince Mohammed bin Salman to arrest members of the royal family and their business associates in a corruption crackdown is proving to be wildly popular among the Saudis young population.
Winter worries may start early as supply of distillate and natural gas are the tightest they have been in years with winter ahead. While in recent years Mother Nature has bailed out these markets with warmer than normal winters, this year even a normal winter could drive prices higher.
While OPEC and The Energy Information Administration raising its outlook for demand and lowers its projection for global Non-OPEC production, The International Energy Agency (IEA) releases a report that shows that tries to talk down demand next year admit they underestimated demand this year.