Oil: Guided by the future moves of OPEC+ - TDS

TD Securities analysts points out that for the oil markets, OPEC+ is still deliberating on a date for their meeting, but Saudi's energy minister delivered a strong signal that the current slump in oil markets pushed prices below the Falih put strike.

Key Quotes

“While he also mentioned that there may not be a need to deepen the cut, Saudi could bear a larger share of the burden. While we expect OPEC+ to put the spotlight once again on the bullish global supply narrative through an extension of their deal, disruption risks are also still plentiful.”

“Restricting the flow of diluents to Venezuela will further hasten the pace of decline in the countries' oil sector. Venezuela's crumbling output, along with sky-high risks to Libya's output and boiling tensions in the Gulf are other areas to watch for supply risk.”

“In fact, the Venezuelan-sanction inspired bounce in prices helped CTAs call off their recent round of selling, in yet another case of a whipsaw for the algos that should see them halt their selling in WTI crude oil, gasoline and heating oil and marginally cover shorts.”