Category: News

EMEA Base Oil Price Report

BY RAY MASSON

Group I prices remain under pressure. Even against a backdrop of producers cutting run rates and a number of refineries in turnaround, Group I supplies are meeting all current requirements. Export markets are still susceptible to alternative sources such as the United States, where prices appear to be exceptionally keen, stymieing European exports.

Group II prices also appear to be coming under pressure. Buyers are aware of the large price difference between Group II and Group I, and with European price levels higher compared to global values, this price delta is coming under scrutiny by the market. At the same time there is increasing length in the Group II market with new offers from the U.S. and Far East appearing daily on the market. These range from small quantities in flexitanks to larger bulk shipments, all of which are eroding the local market for Group II. read more

BRENT Crude Technical Snap (Daily)

Pivot: 59.25 Our preference: short positions below 59.25 with targets at 58.60 & 58.25 in extension. Alternative scenario: above 59.25 look for further upside with 59.55 & 59.85 as targets. Comment: the RSI is above its neutrality area at 50% but reversing down.

Today’s Economic Events

09:30 UK SEP Public Finances (PSNCR) (B GBP) exp: NA prev: 6.4
09:30 UK SEP Public Sector Net Borrowing (B GBP) exp: NA prev: 5.8
15:00 US SEP Existing Home Sales (M) exp: 5.5 prev: 5.5

US indices closed higher on Monday lifted by shares in the Banks (+2.02%), Transportation (+1.91%), Energy (+1.86%) sectors. The S&P 500 is less than 1% away from record highs, a key resistance area for traders. On the economic data front, their was no major data released. The S&P 500 (3,006.72) remains above its 20d moving average (2,958.01 – flat slope) and 50d moving average (2,946.54 – positive slope).

On Tuesday, economists expect Existing Home Sales to release at 5.45 million for September, down from 5.49 million the prior month. The Monthly Budget Statement for September is anticipated to be released between October 22nd and October 25th at 83 billion dollars, down from 119.1 billion dollars in August.

European markets are expected to start on a flat note. read more

BRENT Crude Technical Snap (Daily)

Pivot: 59.60 Our preference: short positions below 59.60 with targets at 59.00 & 58.70 in extension. Alternative scenario: above 59.60 look for further upside with 59.90 & 60.25 as targets. Comment: as long as the resistance at 59.60 is not surpassed, the risk of the break below 59.00 remains high.

Today’s Economic Events

US SEP Monthly Budget Satement (B USD) exp: 85 prev: -200
07:00 GE SEP Producer Price Index (MoM) exp: 0% prev: -0.5%

US indices closed lower on Friday pressured by declines in Boeing, Netflix and Johnson & Johnson. The worst performing stocks were in the Media (-1.5%), Software & Services (-1.36%) and Semiconductors & Semiconductor Equipment (-1.2%) sectors.

On the economic data front, the U.S. Leading Index fell 0.1% on month in September (+0.0% expected,, -0.2% in August).

European markets are expected to start on a positive note.

Foreign Exchange

The US dollar was bearish against all of its major pairs on Friday. On the economic data front, the US Leading Index fell -0.1% missing the unchanged (0.0%) estimate for September, up from a revised -0.2% from unchanged (0.0%) in August. Next week, economists expect the Monthly Budget Statement to be released between October 21st and October 25th at 83 billion dollars, down from 119.1 billion dollars in August.

The Euro was bullish against most of its major pairs with the exception of the NZD, AUD and GBP. In Europe, their was no major economic data released.

The Australian dollar was bullish against most of its major pairs with the exception of the GBP. read more

BRENT Crude Technical Snap (Daily)

Pivot: 59.40 Our preference: long positions above 59.40 with targets at 60.05 & 60.35 in extension. Alternative scenario: below 59.40 look for further downside with 59.10 & 58.80 as targets. Comment: the RSI calls for a bounce.

Today’s Economic Events

15:00 US SEP Leading Indicators exp: 0% prev: 0%

US indices closed slightly higher on Thursday helped by shares in the Health Care Equipment & Services (+1.26%), Food & Staples Retailing (+0.81%) and Media (+0.77%) sectors. Investors maintained a bullish sentiment after news of European Union and the U.K. striking a deal on Brexit. On the economic data front, US Housing Starts fell to 1.256 million in September missing the 1.32 million estimate compared to a revised 1.386 million in August. US Building Permits dropped to 1.387 million for September, above the 1.35 million estimate and lower than the revised prior 1.425 million. Initial Jobless Claims increased to 214 thousand for the week ended October 12th, below the 215 thousand estimate and above the prior 210 thousand. Overall, claims continue to show a tight labor market. Continuing Claims decreased to 1.679 million for the week ended October 5th, above the 1.675 million estimate and down from a revised 1.689 million the prior week. Industrial Production month over month declined to -0.4% for September, below the -0.2% estimate and down from a revised 0.8% in August. On Friday, economists expect the Leading Index to remain unchanged.

WTI crude oil closed higher on Thursday after the Energy Information Administration reported a decrease in gasoline and distillate supplies by approximately 6.4 million barrels.
European markets are expected to start-open on a positive-negative-flat note. read more