The latest drop in crude oil (CL=F, BZ=F) costs raises issues about its influence on international markets. Elements corresponding to President Trump’s tariff bulletins and anticipated OPEC provide will increase have contributed to the decline.
Hedgeye Threat Administration power analyst Fernando Valle joins Catalysts to debate oil costs in opposition to the backdrop of insurance policies from the Trump administration and market volatility.
Valle says that “with no query,” the “OPEC+ improve in provide” is primarily driving the drop in crude costs and oil throughout the board.
Valle additionally highlights the influence of the provision enhance. “We’re nonetheless not in an excellent tight oil market, so bringing in as a lot as 2.2 million barrels a day, which is simply over 2% of world provide, again right into a market that is not very tight is nearly sure to deliver costs down,” he explains.
Valle additionally factors out how US power insurance policies are shaping oil value expectations.
“I do know from our sources within the administration that they need oil to go as far down as $50, whether or not that be Brent or WTI, to assist with inflation considerably,” Valle provides.
To observe extra skilled insights and evaluation on the newest market motion, try extra Catalysts here.
This publish was written by Josh Lynch
Source link