For want of storage

Today’s news headlines:

  • ‘International oil prices fall to more than two-decade low’  The international oil benchmark Brent Crude has been sold off heavily and reached 1999 lows around $16/barrel.  Unlike the shocking falling of WTI futures contracts into negative territory Brent has somewhat more flexibility in that it is delivered by ship. Even so, storage capacity is a major concern across the global and the pressure may only intensify over the coming weeks. (Financial Times)

  • ‘Trump vow to help energy industry sparks opposition’  Donald Trump has signalled his intention to cobble together a rescue package for the beleaguered US oil and gas industry.  Unlike the recently passed $2.2tn stimulus package, this is likely to encounter very stiff opposition from Democrats who see this as way to curry favour heading into November Elections. (Financial Times)

Today's events, rates, and data 

  • Yesterday, equities were under pressure due to oil price turbulence, which signals weak demand heading into the future and should impact forward earnings estimates. However, losses seem to be limited in very thin market trading.

Today's events

AU Retail Sales: 8.2% vs 0.5% last month
UK CPI: 1.5% vs 1.7% last month
UK Home Price Index: 9:30am

Interbank rates:

GBPUSD: 1.2325

GBPEUR: 1.1350

EURUSD: 1.0865