Oil market recovers from liberal panic after Brexit vote

Bloomberg/Fuel Fix:
Oil rose, following the biggest quarterly gain since 2009, amid speculation policy makers will act to limit the fallout from the U.K.’s vote to leave the European Union.

Futures climbed 1.4 percent in New York Friday after surging 26 percent during the three months ended June 30. Global markets have been in turmoil since the British referendum on June 23. U.S. crude supplies shrank a sixth week and production slipped to the lowest since September 2014, Energy Information Administration data showed Wednesday.

Supply disruptions and falling U.S. output have pushed prices up more than 75 percent from 12-year lows early this year. Canada restored production as wildfires eased and Nigeria agreed to a tentative cease-fire with militants. Pledges from central banks have halted a rout in global markets following the British decision to break with the EU, and both the International Energy Agency and OPEC forecast the oil market is heading toward a supply-demand balance.

“We’ve taken back more than half of the drop that followed the Brexit referendum,” said Gene McGillian, a senior analyst and broker at Tradition Energy in Stamford, Connecticut. “The market’s now in a holding pattern, trading within a couple dollars of $50. Attention will turn back to the fundamentals.”
There is more.

 I have said all along that the response to the Brexit vote was overwrought and the market corrections are starting to reflect that.  The European Union is the ultimate "progressive state."   It is more of a regulatory state managed by "experts" who make decisions on the shape of bananas and other trivia as well as some substantive matters.

Britain's withdrawal is likely to give that country more opportunities for trade to offset any losses from their Euro trade.


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