Rex Tillerson’s Firing Adds Risk Premium to Market
Yesterday Trump announced Rex Tillerson, Secretary of State and former Exxon-Mobil CEO, was being replaced by Mike Pompeo, Director of the CIA. The decision (which Tillerson reportedly learned about via Twitter) adds much uncertainty to oil markets, as well as to international politics and economics. Pompeo supports sanctions on Venezuela and opposes the Iran Nuclear Deal, two policies that could lead to significant oil price increases. Click Here to read more from CNBC.
Venezuela’s Oil Production Declines
Venezuela has been a major source of volatility for oil markets – their economic woes have caused weak investments in oil fields, resulting in declining production. Declines are likely to continue for a number of reasons – rig counts have fallen, workers aren’t being paid, and capital expenditures have fallen. According to the EIA, production losses are expected to continue through the end of 2019. Click Here to read more from the EIA.
Driver Compensation Trends
Struggling with driver turnover? So is the rest of the industry. But a study of thousands of driver surveys reveals a few companies are getting it right. What does it take to motivate and retain drivers? Click Here to read more from Fuels Market News.
Glut or Deficit?
With so many different forecasts and variables pointing to supply gluts or deficits in the future, which will it be? Analysts tend to agree that over the medium-to-long term, supplies will not keep up with demand due to a shortage in investment in new drilling. However, in the short-term, both are in balance currently. The most likely scenario for short-term imbalance is a supply glut if economic growth sputters, which is possible given a potential trade war if Trump continues to impose tariffs on other countries. Click Here to read more from OilPrice.com.