OECD oil inventories have never been higher. They were 2.9mb at the end of July, and are expected to have risen further since then, according to energy watchdog the International Energy Agency: In terms of days of forward cover, they are now at 63 days in the OECD overall They are at 68 days in […]
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The consensus failed to forecast last year’s oil price collapse. So is today’s conventional wisdom correct to suggest that prices will now stabilise at current levels and then move higher? We focus on this critical issue in this quarter’s free webinar from The pH Report: The potential for $25/bbl to be the “new normal” for […]
Global markets are becoming ever more complex as the Great Unwinding of stimulus policies continues. This means that each blog post is now taking much longer to write. It therefore seems sensible to focus on writing 3 posts each week - on Monday, Wednesday and Friday – in order to continue to provide the highest possible […]
The oil market was the first to feel the impact of the Great Unwinding of policymaker stimulus nearly a year ago. It had completely lost its key role of price discovery due to the liquidity being supplied by the central banks. This had overwhelmed the fundamentals of supply/demand. And we are still living with the consequences […]
Financial players have become convinced in recent months that the oil price will rise. And so far, this has been a self-fulfilling prophecy. Their buying has led to oil being stored all over the world – in tankers floating at sea and in shale oil wells, as well as in storage tanks. Unsurprisingly, prices have […]
Whisper it quietly to your friends in the futures markets, who are convinced oil prices will soon surge higher. We don’t want to upset them as they work at their spreadsheets, and send their electronic trades down specially constructed lines at near the speed of light. But global oil demand growth has already more than […]
Every oil trader has known the feeling. You’ve done your sums, talked to everyone, and decided the market is going to be short of product. So you start buying discreetly, building up inventory to sell in the future at higher prices. But then the messages from other traders start coming: ‘”What would you bid for […]
Simple stories aren’t always true. That’s certainly the case with the fiction that the fall in the number of US oil drilling rigs will soon reduce US oil production. Exxon Mobil CEO Rex Tillerson recently reminded us of this critical point: “Clearly a significant decline in rig activity did not diminish the continued growth of […]
“I don’t take the view that they (OPEC) are in any way trying to threaten other suppliers. I think they’re really kind of on a classic price-discovery exercise, which is important for all of us as investors to know.” This was the analysis of ExxonMobil CEO, Rex Tillerson, in Houston last week. And he […]
Oil market traders have been having fun in recent weeks, as they have managed to create guaranteed price movements every week: US oil inventory data is published on Tuesday and Wednesday This gives traders the chance to push prices lower as the inventories continue to rise US oil rig data is published on Friday This creates the chance to […]
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Paul Hodges is Chairman of International eChem, trusted commercial advisers to the global chemical industry.
The aim of this blog is to share ideas about the influences that may shape the chemical industry over the next 12 – 18 months. It will try to look behind today’s headlines, to understand what may happen next in important issues such as oil prices, economic growth and the environment. We may also have some fun, investigating a few of the more offbeat events that take place from time to time. Please do join me and share your thoughts.
Between us, we will hopefully develop useful insights into the key factors that will drive the industry's future performance.