Petroleum Complex Outlook - An Excerpt from CRB'S Futures Market Service

Crude oil prices corrected down to a 1-month low from last month’s 1-year high of $82.00 a barrel. That 1-year high is a 43% retracement of the 1-1/4 yr downmove from July 2008’s record high of $147.27 a barrel to December’s 5-1/2 yr low of $32.40 a barrel. Bearish factors include (1) speculation that the most  recent drop in DOE weekly crude and energy product inventories was due to the closure of terminals from Hurricane Ida and that supplies will rebound in the coming weeks, (2) the API report that said US crude oil  production rose 15% in Oct to a 4-year high of 5.36 million bpd as new oil fields in the Gulf of Mexico started production, (3) the comments from Venezuela's Finance Minister that OPEC will "probably" increase oil production in 2010 as the global economy recovers, and (4) comments from ECB Council member  Liikanen that it is unclear whether the global economic recovery is selfsustaining as rising joblessness  casts a “long shadow” over the economic outlook for growth. Bullish factors include (1) the fall in the dollar  index to a 15-month low, (2) comments from OPEC President Botelho de Vasconcelos that current crude  prices are at a “good level,” and (3) the prediction from the AAA that US travel during the Thanksgiving  holiday will increase +1.4% from last year.

OPEC Summary: OPEC-12 output in Oct rose by +80,000 bpd (+0.3%) to 28.760 mln bpd from 28.680 mln bpd in Sep, remaining below last July’s record of 32.775 mln bpd. OPEC-11 (ex-Iraq) output in Oct rose by +80,000 bpd (+0.3%) to 26.310 mln bpd.

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