OPEC+ decides to postpone planned supply increases – TDS

OPEC+’s decision to delay planned supply increases has not been enough to stem the flow of supply risk premiums, notes Daniel Ghali, TDS senior commodities strategist.

Pressure remains on crude oil prices

“Our profitability decomposition framework continues to indicate eroding supply risks due to energy market prices. Combined with a continued deterioration in demand sentiment embedded in prices, pressure remains on crude oil prices.”

“Historically, the implications of OPEC+ decisions have taken several days to filter through to market prices, suggesting that these trends may be reversing. However, while we expect modest-scale buying activity from CTA trend followers in WTI crude, we see no sign that OPEC’s decision has stopped the bleeding of supply risk premiums for now.