Oil in Global Economy Series: Big Traders See Better Balanced Market in 2016

Oil in Global Economy Series: Big Traders See Better Balanced Market in 2016

While global benchmark Brent crude reached new 2016 high yesterday, at $44.8/barrel (CFD), optimisms were plenty in Commodities Global Summit, organized by Financial Times.

• According to Torbjörn Törnqvist, chief executive of Gunvor, question is not whether supply/demand in oil market gets back to balance but when. According to him, oil market will face increased volatility but the direction is likely to be up from here. It may take much more time for the market to come into balance but is sure to happen.
• Jeremy Weir, Chief of Trafigura think oil price have bottomed unless any catastrophic event takes place.
• Ian Taylor, of Vitol, which is world’s largest independent oil trader believes that market is moving towards better balancing.
• Marco Dunand of Mercuria said that $30/barrel price shock led to big wave of investments cutback, leading to faster recovery in prices.
• Glencore’s oil chief was positive but cautioned against larger stock piles both in crude form and refined products, so any significant price rally will have to tackle that.
  

For oil market focus is on 17th, when oil producers, both OPEC and non-OPEC meet in Doha, Qatar to discuss potential oil freeze.

WTI is currently trading at $41.7/barrel and Brent at $2.7/barrel premium.

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