Even if the price of WTI crude was relatively unchanged on the week, Brent slipped 3%. We can nevertheless say that the volatility seen in energy prices over the last few months appears to be gradually dissipating.
- On Friday we learned that the number of active oil rigs in the U.S. had fallen for a 13th consecutive week. According to the website of Baker Hughes (NYSE:BHI), the company has shut down 64 rigs. Since October, the number of active rigs in the U.S. is down by over a third. These recent cuts will have a major impact on profits in the energy sector.
- The value of the Canadian USD/CAD, which plays a large role in the cost of fuel supplies in Canada, fell sharply on Friday in response to the release of strong U.S. employment data. Investors now believe that the U.S. Federal Reserve may raise rates faster than previously thought.
- With energy prices consolidating over the last month and the U.S. dollar gaining ground against our own, we believe that it is a good time to budget part of your fuel expanses for next year.
Have a good week!
Philippe Shebib