We begin Thanksgiving Eve with U.S. crude hitting $58 a barrel. This is the first time since July 2015 and is expected to rise further due to the stoppage of a major Canadian crude pipeline to the United States. The Keystone pipeline is planning to cut deliveries by 85 percent on the remaining volume left to ship in November after a leak was detected late last week.
Think this could be the reason for a rally in prices? The answer is absolutely! Tightness of U.S. crude supplies are why we see U.S. crude trading above $58.05 a barrel today.
On top of this comes the expectation that OPEC will extend their production cut at the end of the month past March 2018. This would leave us little to be thankful for as we see things continue to tighten. There is always a possibility though that the meeting could fall short of market expectations leading to a selloff, which would leave us all burning off the calories and prices after the food festive holiday.
While there may be plenty of food on the table for the Holiday, it does not appear to be the same story for crude oil in the United States. Happy Thanksgiving.
