Oil commentary - 17 October 2023

Morning all. Tuesday. October. 2023. The 17th of. You heard it here first. Brent is trading this morning at $89.90 up 0.25 and WTi is trading up 0.08 at $86.72. I’d like to thank all those of a similar age and generation to myself who agreed with my commentary yesterday about how times have moved on and the trading environment doesn’t quite react as it used to, I stopped short of agreeing with the “Yes! Finally, someone says it out loud! They don’t make them like they used to!” comment, or indeed one unmentionable saying “You and I can remember when Michael Keaton played Batman though Stanley! And that was 34 years ago, pfnor pfnor pfnor”. Yeah. Nah. ANYWAY, so, the second day on the trot that prices have opened up a bit meh, all in the anticipation of things opening up with a massive waheeeyyyy! The thing is though, is that I don’t want to comment on a potential rally in a positive way, because what is happening to cause a potential massive uptick in prices is hardly positive, is it? I would argue that oil markets opening not sure what to do is a troubling sign in that people really have no idea quite what may happen. I’ll be honest, I did expect a pop up in prices yesterday, this purely based on that fact that the market would still be pricing in war risk premium, even though fundamentally, to start with at least, no actual disruption to supply would surface, this is a caveat I, and I’m sure every other energy commentator will ensure is inserted over the short term, but the wider implications is what the market is at risk of. I am still firmly of the belief that just one headline that signals a shift in aggression on what is happening in the Middle East and we will a substantial rise in prices, I get the feeling the market is primed and ready for it, too. Yesterday however we saw a bit of a drop with Brent down 1.24 on the day. This purely on the back of no real headlines from the Middle East, (or news of escalation I should say) and news from the US on a potential easing of sanctions on oil exports from Venezuela. Hmm, whether the latter is a hedge for may happen is what I think the market will be looking out for, but in the meantime all eyes are on the headlines. Good day.