Quote of the Day
To expect defeat is nine-tenths of defeat itself.
Oil prices are relatively steady this morning after another round of selling hit the complex on Tuesday. The bearish monthly fundamental reports along with a fading equity market were the catalysts for yesterday’s selling. Adding more fuel to the selling was the bearish API report that showed a huge build in crude oil stocks as a result of a large increase in imports (see below for more details). The previous week both the API and EIA showed a large unexpected decline in crude oil inventories… due to a decline in imports. As I said last week imports are made up pretty quickly as we already saw in this week’s stock report.
On a positive note there was some upbeat macroeconomic data out of Europe today. The EU showed a 0.4% jump in industrial production while U.K. jobless claims fell more than expected. The EU economy may be starting to stabilize, but even so it is not going to result in any significant increase in oil consumption over the short- to medium-term.
Global equity markets continued to lose ground over the last 24 hours. The EMI Index is lower by 0.55% over the last trading day with the year to date loss widening to 4.6% and another new low for the year. There are four bourses in the negative column for 2013 with Brazil now showing a year to date loss of 18.3%. Global equities continue to act as a negative price catalyst for the oil complex as well as the broader commodity complex.