In the week since our last edition of What’s Affecting Oil Prices, Brent fell $4.18/bbl last week to average $62.84/bbl. WTI fell $3.15/bbl to average $53.81/bbl. Prices have raised slightly heading into Nov. 26. While recent good news might stem the tide of losses, lingering concerns about demand and oversupply will continue to weigh and we expect prices to average $60/bbl this week.
Geopolitics will be a neutral factor in the week ahead although OPEC and non-OPEC oil ministers will likely continue to try and talk up the oil price.
The dollar will be a negative factor in the week ahead. In economic news, the EU has approved Britain’s exit plan, although the plan still faces a tough battle for approval in the legislature.
Trader Sentiment: Negative
Trader sentiment will be a negative factor in the week ahead as markets remain concerned about future demand and global oversupply.
Supply will be a neutral factor in the week ahead. Additional reports continue to indicate that OPEC will likely agree to a production cut next week. While these expectations are lending some support to prices, if a cut fails to materialize or is smaller than expected, prices could move even more sharply lower.
Demand will be a positive factor in the week ahead.
Refining will be a positive factor in the week ahead.
Brent rose $3.17/bbl last week to average $66.84/bbl while WTI rose $2.93/bbl to average $56.81/bbl.
Stratas Advisors expects the Brent average to drift slightly up and WTI to drift slightly down in the week ahead.
In the week since our last edition of What’s Affecting Oil Prices, Brent rose $1.13/bbl last week to average $67.04/bbl, stronger than our expectations.