OIL: Oil Prices Fall on Trump’s Comments.
Jan-23 22:07
- During his first term in office, President Trump employed a line of attack on Saudi Arabia and OPEC+ aimed at driving down the price of oil.
- Yesterday he restarted that approach stating clearly “I am going to ask Saudi Arabia and OPEC+ to bring down the cost of oil,” whilst addressing the gathering of world leaders at Davos.
- OPEC+ has been holding back on supply to support prices as new sources of oil hit markets globally that are outside OPEC+ control.
- It is estimated that there is 1 million plus spare daily capacity available that could be released.
- The comments naturally had the immediate effect on prices with WTI falling from an intra-day high of US$76 bbl to finish the day at $74.26.
- Brent followed a similar pattern having peaked at US$79.60 bbl it fell to close at $77.86.
- This week Trump’s comments on potential tariffs have impacted most markets in different ways and with Canada in his sights for some of the first tariffs, there is evidence that exporters are trying to get ahead of that.
- US imports of Canadian oil are running at a record with the possibility of tariffs seeing more oil being pumped to US refineries.
- Crude inventories however declined for the ninth week straight and are now at their lowest level since early 2022.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
LOOK AHEAD: Thursday Data Calendar: Weekly Claims, Tsy Bills & 7Y Note Sale
Dec-24 18:38
- US Data/Speaker Calendar (prior, estimate)
- Dec-26 0830 Initial Jobless Claims (220k, 223k)
- Dec-26 0830 Continuing Claims (1.874M, 1.881M)
- Dec-26 1130 US Tsy $75B 4W, $70B 8W bill auctions
- Dec-26 1300 US Tsy $44B 7Y Note auction & $64B 17W bills
STIR: FED Reverse Repo Operation
Dec-24 18:24
RRP usage climbs to $180.989B this afternoon from $116.004B yesterday. Compares to $98.356B last Friday - the lowest level since mid-April 2021. The number of counterparties climbs to 52 from 47 prior.
US TSYS: Late Session Rebound, Post-Auction Short Sets Unwound
Dec-24 18:19
- Treasury futures look to finish Tuesday's shortened Christmas-eve session near session highs, TYH5 +2.5 at 107-17 vs. 108-19 high, after trading much of the session weaker. The 10Y contract had breached a couple levels of technical support on it's way down to 108-09.5 low, 10Y yield climbing to 4.8160% high last seen in late May.
- Rates recovered soon after the $70B 5Y note auction (91282CMD0) stopped 0.2bp through (second consecutive stop since June): drawing 4.478% high yield vs. 4.480% WI; 2.40x bid-to-cover vs. 2.43x for the prior auction.
- The bounce helped projected rate cuts into early 2025 look steady to slightly higher vs. this morning (*) as follows: Jan'25 steady at -2.1bp, Mar'25 at -12.6bp (-11.7bp), May'25 -17.2bp (-16.7bp), Jun'25 -24.6bp (-23.1bp).
- No substantive reaction to regional Fed data:
- -6.0 reading for December's Philadelphia Fed's Nonmanufacturing current regional activity index (-2.4 expected) represented a steady outturn from -5.9 prior, and suggested a regional services sector that remained "weak", per the report.
- Richmond Fed's regional manufacturing survey index came in in at -10 as expected in December, the best reading since June (-14 prior). The shipments and employment subindices were flat, but new orders saw a solid improvement to -11 from -19 prior.
- Markets closed for Christmas holiday Wednesday, Globex pre-open Wednesday evening at 1700ET/re-open at 1800ET. Full sessions Thursday & Friday.
Trending Top
Mar-27 20:13
