Daily Market Briefing
Upbeat U.S. and Chinese economic data, decline in Venezuela oil production support oil prices
Venezuela’s oil exports have dropped by 40% to around 920,000 barrels per day after the U.S. implemented sanctions against the country’s oil industry a month ago. Venezuela is member of OPEC which along with some non-OPEC oil producers agreed to cut production by 1.2 mio. barrels per day from January this year. The production cut deal will be discussed by the oil producers in Vienna in April.
Tonight, the weekly oil rig count from Baker Hughes is published. Last week saw a drop in the number of active U.S. oil rigs of 4 after two weeks of increases. U.S. oil production continues to climb, touching 12.1 mio. barrels per day according to the Energy Information Administration (EIA).
Overnight, Chinese Caixin Manufacturing PMI came out improved compared to a month before, 49.9 versus 48.5 after mediocre data earlier this week. In addition, last night, data showed that the U.S. economy grew by an annualized 2.6 % in the fourth quarter of 2018. This is lower than the 3.4% expansion in the third quarter but larger than the expectation of 2.4%. Due to the upbeat data, the financial market sentiment improved, likely spilling over to the oil market.