"Tight Now, Loose Later: Oil Futures Flash Warning"

" Tight Now, Loose Later: Oil Futures Flash Warning \r\nLast week, OPEC+ \u00a0announced \u00a0it will once again accelerate the pace of unwinding of production cuts, with output targets for June increasing by 411,000\u00a0 barrels per day, equivalent to three monthly increments. This follows a similar move in April, with the organization appearing willing to stay the course amid low oil prices and fears of weakening demand. We reported that global crude inventories remain low enough, thus giving OPEC+ a window to scale back its voluntary cuts until the market surplus finally arrives. Saudi Arabia appears intent on \u201cpunishing\u201d OPEC+ rascals such as Kazakhstan and Iran for repeatedly violating their quotas.\r\n\r\nCommodity analysts at Standard Chartered have reported that the latest OPEC survey of secondary sources reveals that Kazakhstan's crude oil output clocked in at 1.852 mb\/d in March, 384 kb\/d above its OPEC+ quota. Further, the country also failed to keep its promise to cut 38 kb\/d in compensation for overproduction in March, bringing its total overproduction to 422 kb\/d. The same scenario is expected to unfold in the coming months. Kazakhstan produced 240 kb\/d more y\/y in March, a sharp contrast from the other eight OPEC+ members who produced a combined 612 kb\/d less.\r\n\r\nAnd now, the oil futures markets are sending a dire warning that oil bulls could find themselves in trouble quite soon due to a combination of the OPEC+ output hike and Trump\u2019s tariffs.\r\n\r\nOil futures curve has formed a rare \"smile\" shape, a structure Morgan Stanley says was last seen briefly in February 2020 just before the infamous oil price crash. On Wednesday, Brent futures' July contract was trading at a premium of 74 cents to the October contract, a market structure known as backwardation, foreshadowing immediate tight supply. However, prompt prices from November have formed a contango, with forward prices flipping to a discount, indicating oversupply as traders predict Trump\u2019s tariffs will eventually weaken oil demand. Having backwardation and contango together leads to the rare \"smile\" shaped curve.\r\n\r\nAccording to the latest available data by the International Energy Agency (IEA), global oil inventories stood at 7.647 billion barrels in February, down from 7.709 billion barrels for last year\u2019s corresponding period and close to the bottom of their historical five-year range.\r\n\r\nMeanwhile, refiners' appetite for crude is climbing ahead of the peak driving season in July and August, \" Refinery maintenance in the Atlantic basin will start to taper off, increasing oil demand (for refining)... Summer driving should provide some support, \" BNP Paribas analyst told Reuters.\r\n\r\nGlobal oil demand is expected to rise by 1.3 million barrels per day in the third quarter of the current year, up from an average of 104.51 million bpd in the second quarter, the IEA has predicted. The 1 million bpd output increases announced by OPEC+ so far, coupled with another 400 kb\/d increase in July, almost matches the predicted demand increase, implying oil markets will not face a surplus till late in the year.\r\n\r\nMeanwhile, oil prices jumped in Thursday\u2019s session after the Trump administration\u00a0 announced \u00a0it has struck a trade deal with the UK. Brent crude for July delivery was up 2.7% to trade at $62.75\/bbl at 12.50 pm ET while WTI crude contract for June delivery added 3.0% to change hands at $59.86 per barrel. However, terms of the deal appear to fall well short of the \"comprehensive\" package Trump earlier touted.\r\n\r\nAccording to Trump, UK Prime Minister Keir Starmer will further reduce non-tariff barriers and fast-track U.S. goods into his country. Meanwhile , \u00a0another solid week of\u00a0 jobless claims \u00a0underscored the Federal Reserve's ongoing unwillingness to cut rates. U.S. jobless claims fell 13,000 to 228,000 for the period ending on May 3. Continued claims, however, clocked in at just over 1.9 million, near the highest levels since 2021, suggesting workers are still finding it difficult to secure new jobs as the economy stalls.\r\n \r\n \r\n\r\nThat said, commodity analysts at Standard Chartered have predicted that path of least resistance for oil prices is lower in the coming months, with oil prices to remain low before beginning a gradual recovery later in the year as U.S. oil output declines. StanChart, however, says there\u2019s some technical support in the short-term, with fundamentals remaining fairly positive. Recently,\u00a0\u00a0StanChart\u00a0 cut\u00a0 its 2025 oil price forecast to $61\/bbl from $76 and also lowered its 2026 forecast to USD 78\/bbl from $85 citing Trump\u2019s tariffs.\r\n\r\n \r\n "

"Tight Now, Loose Later: Oil Futures Flash Warning"

First National Bank Ghana appoints Joel Ainsah-Mensah as Head of CreditAMP

MPC Reduces Central Bank Benchmark Interest Rate to 21.5%AMP

Global Debt Remains Above 235% of World GDPAMP