Strategic release of reserves is too little too late

The announcement of the co-ordinated release of oil reserves by the US and other large oil consumers should mean higher supply (and downward pressure on prices) but it will come at a time when we expect that the market will be in a surplus anyway. What’s more, the big risk is that the release prompts OPEC+ to slow or halt its output rises.
Kieran Tompkins Assistant Economist
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Energy Update

Revisiting our oil market outlook

Omicron will weigh on jet fuel demand in the next few months, but the wider hit to demand is still unclear. And although OPEC+ decided to push ahead with its planned oil production increases, we think it will struggle to raise output by as much as planned next year. So, for now, we are leaving our end-2022 oil price forecasts unchanged, but downside risk has risen due to the threat to demand.

3 December 2021

Energy Data Response

US Weekly Petroleum Status Report

US commercial stocks fell as, despite some chunky falls in product demand, US demand is still outstripping supply. Although, the release did shows signs that crude production might finally be responding to higher prices.

1 December 2021

Energy Data Response

US Weekly Petroleum Status Report

US commercial stocks rose due to a pre-planned release of reserves and a large drop in exports. But the bigger picture is that product demand remains healthy, adding pressure to a tightening market.

24 November 2021

More from Kieran Tompkins

Energy Data Response

US Weekly Petroleum Status Report

US commercial stocks rose due to a pre-planned release of reserves and a large drop in exports. But the bigger picture is that product demand remains healthy, adding pressure to a tightening market.

24 November 2021

Energy Update

Taking stock of the European natural gas market

European natural gas prices were in the news again last week, soaring by 18%. Given stocks are still low and there are few signs of extra flows from Russia, we think that prices will remain high in the near term.

23 November 2021

Metals Watch

Higher inflation won’t stop the gold price from falling

In this Metals Watch, we revisit the theoretical relationship between the price of gold and inflation, before assessing how this relationship has held up throughout history. The key takeaway is that although gold is an effective long-term hedge against inflation, its effectiveness at shorter horizons depends on how long-term expectations for inflation and monetary policy evolve. We think that long-dated real yields will rise somewhat over the next few years, which should be enough to pull down the gold price.

17 November 2021
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