Crude oil prices are up last night and this morning after a wild day, and now get ready for new bursts of market-moving news today and later this week, as closely watched data will be announced.
The big picture: It's hardly a surge and the market is grappling with fresh estimates of softening demand growth.
Driving the news: Yesterday prices instantly plunged by over $1 per barrel at midday when news broke that national security adviser John Bolton was out.
- Departure of the hawkish Bolton raises the prospect of easing U.S.-Iran relations.
- RBC Capital Markets analyst Helima Croft said it "could be a catalyst for a material de-escalation in the Iran standoff” and bring more Iranian crude back into the market, per Bloomberg.
The Bolton news tapped the brakes on prices that had been buoyed by signs that Saudi Arabia is committed to continuing OPEC's oil production-limiting agreement with Russia.
It's not the only thing creating headwinds for oil prices. Shortly after Bolton was gone, The U.S. Energy Information Administration again trimmed its global oil demand growth forecast.
- "EIA expects the rate of consumption growth for global liquid fuels to fall below 1 million barrels per day in 2019 for the first time since 2011," the agency said.
- What's new: Today OPEC also trimmed its estimate for demand growth this year, S&P Global Platts reports.
But, but, but: Prices got a lift late yesterday afternoon when the American Petroleum Institute reported a 7.2 million barrel decline in U.S. crude stockpiles last week, according to Reuters.
- Where it stands: Brent crude was trading around $63 this morning.
What's next: EIA will issue its report on U.S. crude stockpiles later this morning. And tomorrow the International Energy Agency will release its monthly analysis of global crude demand, which comes the same day that OPEC and Russian officials will gather in Abu Dhabi.
One big question: It's unclear to what extent Bolton's exit may lead to any changes in U.S. posture.
- In a note Tuesday, ClearView Energy Partners points out that the Bolton era included U.S. withdrawal from the Iran nuclear deal, public criticism of Russia, and sanctions against Venezuela.
- However, "we would caution against the a priori conclusion that a post-Bolton administration might materially pivot from those positions," the research firm writes, because it's unclear who will replace him and other hawkish Trump officials remain in place.