The IEA indicated in its report that the long-awaited rebalancing of the global oil market has begun but is likely to last through 2016 as the supply overhang is expected to persist through 2016. Overall it was a supportive report but one that is still projecting supply to outstrip demand through 2016.
World crude oil demand is expanding at its fastest pace in five years thanks to rebounding economic growth and low prices, but global oversupply will last through 2016, the West's energy watchdog said on Wednesday.
One day after shocking the globe by devaluing its currency, the Chinese government is now trying to tell us not to worry; that the move is not a sustained devaluation even after China's Central Bank for the second day in a row cut the guiding rate for the Yuan.
Since July, every time crude oil gets a bid there is some news to squash the rally. This time the People's Bank of China, in a surprise move, devalued its currency causing its biggest one day sell-off in almost 20 years.
Many oil companies had trimmed their budgets heading into 2015 to deal with lower oil prices. But the rebound in April and May to $60 per barrel from the mid-$40s suggested that the severe drop was merely temporary.
The Federal Reserve takes out its reference to "stabilizing oil prices" and the Saudi's are dropping hints of an oil production cut. This comes as U.S. oil production sputters and inventories falls. We may have just hit a bottom as crude oil companies quickly react and probably overreact regarding July's oil price crash.
We’re just past the halfway mark of the week and the year. Many will argue that the $50 per barrel level is the halfway point between the range that WTI belongs ($45 - $55). We’re at the halfway point for the hedges that most oil producers had on for 2015.