Brent fell $2.28/bbl last week to average $80.26/bbl. WTI fell $2.70/bbl to average $70.24/bbl. WTI has now returned to its pre-rally level but Brent is still several dollars off and could continue to decline next week. We expect Brent will fall farther next week as tension between Saudi Arabia and the United States lessens. We expect Brent will average $78/bbl next week.
As the November 4 deadline for stopping Iranian shipments looms, markets will be closely watching to see if the State Department approves any waivers. Several Asian consumers including India have reportedly applied for waivers. Another week of large crude builds in the US could cause prices to fall even faster, especially if coupled with a build in refined products.
Geopolitical – Neutral
Dollar - Neutral
Trader Sentiment – Negative