First thing this morning, we noted that crude fell off a cliff just after 4:30 a.m. EST.
That move lower was blamed on Brent’s inability to move above $50.
Whatever you want to say about it, the fact is that it came on the heels of oil slamming on the brakes after its longest run of gains this year (for Brent the longest run since 2012), a run which itself followed crude’s collapse into bear market territory last month.
Between news that OPEC production rose to its highest this year in June and Russia refusing to back any proposal for deeper production cuts, the tone has turned decidedly bearish again.
Fast forward several hours and oil is in free fall.
“WTI, Brent are tumbling amid Russian opposition to deeper cuts,” Bloomberg writes.
“Russia pretty much threw cold water on [things],” Bob Yawger, director of the futures division at Mizuho Securities USA in New York remarked.
Oil exports by the Organization of the Petroleum Exporting Countries climbed for a second month in June, Thomson Reuters Oil Research data showed.
OPEC exported 25.92 million barrels per day (bpd) in June, up 450,000 bpd from May and 1.9 million bpd more than a year earlier.
The rise in exports comes despite OPEC’s vow to rein in production until March 2018 and follows hot on the heels of Reuters’ monthly OPEC production survey which found output jumped to a 2017 high last month as OPEC members Nigeria and Libya continued to pump more.
Don’t forget these fun headlines from earlier:
- Citigroup says oil’s recent price gains mark start of sustainable rally in prices.
- UBS sees OPEC cuts draining inventories and helping crude rise toward $60/bbl.
Watch the API numbers later today…