February 2020 - Portland Fuel

Monthly Pricing - 01/02/2020

Sterling began January at 1.32, although it was sold off mid-month in anticipation of a BoE rate cut – only to be kept at 0.75%, causing a rebound in sterling to 1.310.

In an eventful month for crude prices, Brent soared to over $70/bbl following the US assassination of Iran’s Revolutionary Guard General, Qassem Soleimani, before crashing to a low of $58 as the coronavirus paralysed trade with China and grounded flights.

Brazil performed a volte-face as it announced it would begin talks on joining OPEC in 2021, only to dismiss any claims that it would. The South American country produced over 3mbpd in 2019.

Price Drivers

Supply Norway increased output to 1.8mbpd as its Johan Sverdrup oil field came online in October. ExxonMobil, Total, and Apache continue to find hydrocarbon fields in Suriname and Guyana’s EEZs.

Demand The Sino-American “Phase One” trade deal was signed on 15th January. The UAE’s Fujairah port stock levels grew to a five-week high, reflecting lower Asian demand from the coronavirus.

Geopolitical Libya’s National Oil Company cut supply to 200kbpd as General Haftar embargoed oil exports. Iran-backed Houthi rebels launched a missile attack on a Saudi Aramco refinery in Jizan.