Oil: Fade crude driven gains in CAD - BNPP

Research Team at BNP Paribas, notes that the oil prices rebounded Thursday on reports suggesting Iran would join an informal OPEC meeting in Algeria planned for September.

Key Quotes

“However, our commodity strategists remain sceptical that a deal can be reached to restrict supply meaningfully. Comments from the Saudi energy minister Thursday seemed to support this view, noting that there have been no substantive discussions yet on a production freeze and that he does not believe any significant intervention in the market is necessary.

Our strategists expect WTI prices to average $45 in Q4, implying downside risk from current levels and for commodity sensitive currencies such as the CAD. We continue to expect the AUD and CAD to underperform in an environment of market adjustment to price in September tightening from the Fed.”