Technical & Fundamental Oil Reports Specialists

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Put on your crash helmet

Published Friday, August 8th, 2014

“Heightened geopolitical risks as well as developments in emerging market economies and global financial markets may have the potential to affect economic conditions negatively” Mario Draghi told us yesterday. He described Europe’s recovery as “weak, fragile and uneven” which could be derailed by the fallout from events in Ukraine.

He did not tell us anything new and we know he was pulling his punches for fear of triggering a run for the exits. He merely added a subdued note to a pretty awful day.  Air strikes on Iraq are to resume, the Gaza ceasefire ended, Ebola is on the march and the Russian sanctions tit for tat escalated. The raging civil wars in Syria and Libya do not make the headlines anymore.

In Europe the move towards the stock market exits has begun and the U.S. will not be far behind. Only the Japanese and Swiss stock markets closed higher. The German 2 year bond yield turned negative and the 10 year yield is only a whisker above 1%. Gold climbed to $1314 an ounce.

WTI closed with a gain of 42cts/bbl (97.34) and Brent gained 85cts/bbl (105.44). Geopolitical forces were probably behind the gains and worries over the implications of the ISIS advance on Iraqi Kurdistan have added another 90cts/bbl overnight to Brent as we write.

 

to read the rest of the report, please click here 

Posted by David Hufton