Oil commentary - 1st May 2024
Morning all, two days on the trot! Waheeyyy! Wait a minute, is it May? It bloody is May, isn’t it? I hadn’t even noticed. Not because of my failing to talk to you to you through the medium of this commentary, of course, but the fact that 2024 so far has, quite frankly, been nothing short of a blur. More on what the year bought us in just a moment and before I get too wistful and all Uncle Albert and speak of times of “when I was younger”, let’s see where Brent, and its US sibling, are trading, shall we? Brent is trading this morning at $85.61 down 0.72 and WTi is trading down 0.76 at $81.17. You would be forgiven for thinking, hang on, I’m forgetting to do something, Ummmm, do I have something in the oven, noooo, did I leave a tap on? No no no, Wait the iron! I left the iron on! Again, you’d be wrong. It’s the start of the month and if your day starts with thinking about all things oily, crudey or shippingey (real word) then you would be forgiven for your implicit memory kicking in and jumping out of bed shouting “OPEC MEETING!!!”. Alas, relax my oily friend, the next meeting isn’t until June. April phonecalls and May working hours bring forth June OPEC powers. Probably. I wonder though, the last meeting in April didn’t yield a lot. In fact, the last few meetings have yielded less results than Newcastle Football Club, yet with oil prices steady for the majority of the year, what do we, and the market, realistically expect the group to do? I said I’d reflect the year that has been so far and if we look at where Brent has settled at the end of each month so far this year, one could argue that OPEC strategy has been largely successful in regard to price stability – end Jan $81.71, end Feb $83.62, end Mar $87.48 and end April $87.86. Sure, a steady uptick, and this has been reflected in prices at the pump for the end user, too, but with a macro economic environment that seems to be absorbing higher costs and one which the Fed later on will probably mirror later with no change on interest rates, why would OPEC do anything? Let’s see what Jay-Pow! Says later. Good day.