Macro Energy

Volatility in the energy markets directly impacts equity, fixed-income, currency, and commodity markets. The Macro Energy service from Energy Aspects offers a specific focus on how energy prices are being driven by supply and demand fundamentals and geopolitics, and how that in turn will feed into risks and opportunities across a whole host of markets.

  • Double jeopardy

    Double jeopardy Cover image Published 13 Jul 2018 by

    Crude oil markets, already feeling soggy from record US exports and a recent surge in GCC production and exports, collapsed this week from a double whammy of Libyan crude exports resuming and the Trump administration escalating its trade tiff with China.Ironically, a third potential catalyst, a p..

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  • This one goes to 11

    This one goes to 11 Cover image Published 29 Jun 2018 by

    Oil prices have rebounded sharply since the OPEC meeting one week ago, in part due to inconsistent Saudi signals about whether the surge in production from the Kingdom will be effective immediately. Since Saudi Energy minister Khalid al-Falih said in Vienna that OPEC+ will be increasing its produ..

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  • Filtering out the noise

    Filtering out the noise Cover image Published 15 Jun 2018 by

    Note: Next week we will provide an update from the OPEC meeting in Vienna instead of the usual Digest.For all the hysteria about various proposals for a production hike from Saudi Arabia and Russia, it is important to remember that Saudi energy minister Khalid al-Falih has yet to disclose publicl..

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  • Eye of the needle

    Eye of the needle Cover image Published 8 Jun 2018 by

    There is no doubt that Saudi Arabia is under intense political pressure to get oil prices down going into the OPEC meeting. The ‘why’ is a little harder to understand. It could be because they know something about the US administration’s intentions vis-à-vis Iran and/or Venezuela, or it could be..

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  • OPEC fatigue

    OPEC fatigue Cover image Published 1 Jun 2018 by

    It is never a good sign when there are still three weeks to go before an OPEC meeting and even the journalists are getting sick of delegates calling them to recount the latest twists and turns in the OPEC/Russia saga. But journalists and traders alike have been scrambling since Russian energy min..

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  • OPEC's dilemma

    OPEC's dilemma Cover image Published 25 May 2018 by

    It is less than one month before the OPEC meeting, and the heat is clearly rising on OPEC to tame rising oil prices. Several weeks ago, President Trump tweeted that OPEC needs to do something about high oil prices. Earlier this week, Senate democrats wrote a letter to the president urging him to..

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  • The dash for trash

    The dash for trash Cover image Published 18 May 2018 by

    Back at the start of the year we noted a few important developments that the broader oil market was slow to realise. First, we noted that Brent, which had been trading in a $40-60 range for the past three years, was now shifting into a higher range, closer to $60–80 per barrel. Of course, all tha..

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  • Bear trap

    Bear trap Cover image Published 11 May 2018 by

    Over 2015, the oil market kept trying to pick the bottom of the rout as traders convinced themselves that the worst was over. Instead, prices continued to convulse lower all the way down to $27 by January 2016, significantly below most people’s expectations. In many ways, we are now seeing the fl..

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  • Geopolitical risks vs realities

    Geopolitical risks vs realities Cover image Published 4 May 2018 by

    Given the volume of news flow over the last several weeks regarding Iran, Libya and broader oil fundamentals, it’s perhaps a little worrying for oil bulls that WTI has traded in a roughly $2 per barrel range since 19 April. After selling off in February, oil prices had been steadily moving higher..

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  • A serving of Macron and cheese

    A serving of Macron and cheese Cover image Published 27 Apr 2018 by

    It was no secret that French President Emmanuel Macron’s state visit to Washington DC this week was, in effect, a last-ditch effort to salvage the Iran nuclear deal—the Joint Comprehensive Plan of Action (JCPOA)—which President Trump has signalled his clear intent to pull out of. The real questio..

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  • Playing Catch-up

    Playing Catch-up Cover image Published 20 Apr 2018 by

    While it’s very easy to lay the blame for the recent oil rally strictly on geopolitical risk premia, and there certainly have been many candidates in the last month, the reality is that the market is finally beginning to wake up to the fact that we have almost completely eroded the inventory, i.e..

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  • War and peace

    War and peace Cover image Published 13 Apr 2018 by

    The price action over the last two weeks was driven primarily by war and peace. Last week, fears of a trade war between China and the US weighed heavily on broader risk assets. But by Monday, risk had rebounded from last week’s swoon after Chinese President Xi Jinping struck a conciliatory tone,..

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  • Betting on the river card

    Betting on the river card Cover image Published 6 Apr 2018 by

    Had we said back in November 2017 that US petroleum inventories would not only fail to build in Q1 18 but instead draw by some 40 mb, that Donald Trump would appoint John Bolton as National Security Advisor and Mike Pompeo as Secretary of State, putting Iran firmly in US crosshairs, and that oil..

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  • Eroding global shock absorbers

    Eroding global shock absorbers Cover image Published 29 Mar 2018 by

    This Friday is the end-of-month and the end-of-quarter, but for much of the world it is also Easter Friday. As such, we are publishing an early and condensed Digest this week. With both Nymex and ICE closed on Friday, Thursday will be the last day to finish squaring books and index rebalancing ha..

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  • The drums of war

    The drums of war Cover image Published 23 Mar 2018 by

    The oil markets bucked the broader trend in risk markets this week by extending a rally that began last Friday despite some major macro headwinds. Broader risk assets have sold off as the market digests a host of developments: a Fed which is hiking rates, the prospect of the Trump administra..

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