What Really Killed The Oil Price Rally

4 Oct 2017   Prices

The oil market gained a lot of momentum in August and September, and Brent flirted with $60 per barrel toward the end of last month. But suddenly, oil prices have pulled back from their recent highs, and could head lower unless some bullish data emerges. The recent rally—unlike other rallies over the past three years—has been underpinned by substantial improvements in the underlying fundamentals. Global refined product stocks are just a bit above the five-year average , having drained significantly in recent months. Crude stocks are also down, oil supply fell in August, and demand has picked up. In other words, unlike the numerous (but brief) oil price rallies in 2015, 2016 and even earlier this year, the most recent run up in prices appears to have been quite a bit more justified by the improving supply/demand balance. Yet, the rally might already be losing steam, with Brent falling […]

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