Senior Market Analyst, Commodities and Energy
John's Feed
Jun 1, 2015

U.S. shale and OPEC, the altered balance of power: Kemp

LONDON, June 1 (Reuters) – Two landmark events this month
will underscore the extent to which the oil market’s balance of
power has been transformed by the shale revolution.

In Washington, Congress will begin considering legislation
to permit the export of crude oil from the United States,
reversing a four decade ban put in place after the first oil
crisis in 1973/74.

May 28, 2015

Maritime disputes test China’s peaceful rise: Kemp

LONDON, May 28 (Reuters) – The South China Sea has become
the most important testing ground for the changing economic,
political and military relationship between China and the United
States.

The islands, rocks, reefs and shoals at the heart of the
dispute – most of them uninhabited and submerged at high tide -
cover just a few square kilometres of a sea area that extends
over 3 million square kilometres.

May 26, 2015

Driving is making a comeback in the US: Kemp

LONDON, May 26 (Reuters) – California motorists consumed an
extra 34,500 barrels of gasoline every day in February compared
with the same month last year, state tax records show.

The state is just part of a nationwide surge in driving that
has pushed U.S. gasoline consumption up by more than 300,000
barrels per day compared with last year.

May 22, 2015

Traders watch the falling price of oil storage: Kemp

LONDON (Reuters) – Futures prices indicate the physical market is easily absorbing the large volume of crude being supplied and global rebalancing is well underway.

The price for storing a barrel of Brent for six months has fallen from more than $1.23 per month at the start of 2015 to just 37 cents per month on May 21.

May 20, 2015

How do you lose 100 million barrels of oil? Kemp

LONDON, May 20 (Reuters) – Oil-market watchers are
struggling to reconcile the large estimated oversupply in the
market with the much smaller buildup of reported inventories and
narrowing contango in futures prices.

Some blame the barrel counters who compile official
statistics on supply, demand and stocks. But the truth is that
information on the world oil market is incomplete and it is easy
for hundreds of millions of barrels of oil to disappear from the
supply chain without being counted.

May 18, 2015

Oil volatility fades as risks become more balanced: Kemp

LONDON (Reuters) – Oil prices have become much less volatile in recent weeks as the record short position previously established by hedge funds has been squared up and prices return to a level at which many U.S. shale wells are profitable.

Realized volatility, a technical measure of the day to day variability in prices, has fallen to an annualized rate of just 24 percent, down by more than half from its peak of 60 percent in late February.

May 15, 2015

U.S. refiners dominate western hemisphere markets: Kemp

LONDON, May 15 (Reuters) – The United States is fast
becoming the major refining hub for the entire western
hemisphere as plentiful crude at home and superior efficiency
enable U.S. refiners to grab market share across the region.

U.S. refiners now supply almost a quarter of the rest of the
hemisphere’s daily fuel demand, up from less than 10 percent a
decade ago.

May 14, 2015

Who wants to be a swing producer? No one: Kemp

LONDON, May 14 (Reuters) – U.S. shale producers are the new
“swing producers” in the oil market, as many analysts have
noted, but the status of swing producer is hugely misunderstood.

It is often portrayed as if it confers power and control. In
fact, it often means the opposite. The swing producer often
becomes the passive absorber of shifts in market supply and
demand.

May 12, 2015

U.S. set to get more accurate oil production data: Kemp

LONDON, May 12 (Reuters) – “The data must be wrong,”
according to veteran oil analyst Phil Verleger, who wrote in a
blistering note that the Energy Information Administration is
probably overestimating U.S. oil production by 1.6 million
barrels per day.

Verleger argues substantially lower U.S. production is the
most likely explanation for why global stocks are not rising as
fast as predicted and discounts for storing barrels are
narrowing (“Notes at the margin” May 11).

May 11, 2015

Oil rallies as hedge funds are caught short: Kemp

LONDON (Reuters) – Oil’s sharp rally since the middle of March has been driven by a race among bearish hedge funds to cover loss-making short positions rather than any great bullishness about the outlook.

On the eve of the rally, hedge funds and other money managers had amassed record short positions in WTI-linked futures and options amounting to 209 million barrels of oil.

    • About John

      "John joined Reuters in 2008 as one of its first financial columnists, specialising in commodities and energy. While his main focus is on oil markets, he has written broadly on the emergence of commodities as an asset class, regulatory issues and macroeconomic themes. Before joining Reuters, John spent seven years as a senior analyst for Sempra Commodities (now part of JP Morgan) covering base metals and crude oil. Previously, he worked as an analyst on world trade, banking and financial regulation for consultancy Oxford Analytica."
    • Follow John