OVERVIEW July through November 2018 The second half of 2018 has been quite eventful – reaching both the highest and the lowest prices of the year within a few weeks of each other. July began with some quick volatility as both Canada and Libya experienced production outages amounting to a combined 1 million barrels per day (MMbpd). In response to the outages, Trump tweeted that Saudi Arabia had agreed to increase production by 2 MMbpd – which the kingdom quickly denied, though months later the nation did up its output.
By late July, geopolitical tensions were broiling. Iran’s President Rouhani said in a speech that any effort to cut off Iranian exports would be met with the “mother of all wars,” to which Trump responded with an all-caps tweet not to threaten the U.S. With this exchange fresh in the market’s memory, a Saudi tanker was attacked by Iran-backed Houthi rebels in the Bab el-Mandeb Strait, one of the largest oil chokepoints in the world. Fortunately, those conflicts did not escalate to broader tensions, and geopolitical frictions cooled thereafter.
2018 Market Summary
Source: New York Mercantile Exchange (NYMEX)
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© 2018 Mansfield Energy Corp
