The Phil Flynn Energy Report
Today’s API report may be anti-climactic as the world awaits the U.S presidential debates. It will be a clash of titans. Vice president Joe Biden with over 50 years of experience and energy policy versus the reigning champion and outsider from New York, the brash and bold, president Donald Trump. There's no doubt that fracking will come up. One would assume that if Biden becomes president, it will be harmful to U.S. oil and gas interests, and it will cause higher prices for gasoline and heating your home.
Most of the news on oil is supportive except for fear of another round Covid-19 infections and the continuing return of Libyan crude. Around the globe, oil supply is tightening. We see reports of increased Japan imports of oil and more stories of gasoline into India. The U.S. is threatening more sanctions on Iran as they continue to thwart the U.S. by exporting oil to Venezuela. Stimulus hopes are keeping risk on, but Covid fears are keeping that in check. In Libya, oil production is also harmful as its production has risen 250,000 barrels a day (bpd) and could rise to over 1 million bpd by the end of the year.
OPEC hasn’t said how they will adjust output if the Libyan oil comes back continues. At some point, they will have to face the fact that Libyan oil might continue to flow, unlike previous attempts to go back online.
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