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Canada gets a downgrade

The Organization for Economic Cooperation and Development (OECD) lowered its economic growth expectations for Canada in its most recent report, released March 18. The new predictions put economic growth in Canada this year at 2.2%, down from 2.6% in its November forecast. For 2016, the group now sees growth of 2.1%, down from 2.4% previously.

“Oil and commodity exporters are facing weaker growth prospects as the result of lower prices,” the OECD said. Expectations for Brazil’s outlook were also lowered. “The main class of countries for which near-term growth prospects have worsened since the November 2014 economic outlook is the commodity exporters,” the report said.

“The interim projections are significantly lower for oil-exporters Canada and Brazil, with short-term growth prospects in Brazil also being restrained by monetary and fiscal tightening and increasing political uncertainty.” According to the OECD, “Growth has already slowed in many other oil-exporting countries, and with the fall in commodity prices going well beyond oil, exporters of metals, coal and some agricultural commodities also face less favorable growth prospects this year.”

Brent falls below $53

Brent crude oil prices fell below $53 on Wednesday on oversupply concerns as industry data indicated U.S. crude stockpiles reached an all-time high last week. The price of West Texas Intermediate touched a six year low of $42.05 in early trading. Crude oil stockpiles rose by 9,622 MBO to a total of 458,508 MBO for the week ended March 13, 2015. The average analyst estimated a 4,111 MBO build.

Global oversupply concerns have been spurred by factors including U.S. output levels, some recovery in Libya’s production and the potential for a boost in Iran’s exports should Western sanctions be lifted.

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Important disclosures: The information provided herein is believed to be reliable; however, EnerCom, Inc. makes no representation or warranty as to its completeness or accuracy. EnerCom’s conclusions are based upon information gathered from sources deemed to be reliable. This note is not intended as an offer or solicitation for the purchase or sale of any security or financial instrument of any company mentioned in this note. This note was prepared for general circulation and does not provide investment recommendations specific to individual investors. All readers of the note must make their own investment decisions based upon their specific investment objectives and financial situation utilizing their own financial advisors as they deem necessary. Investors should consider a company’s entire financial and operational structure in making any investment decisions. Past performance of any company discussed in this note should not be taken as an indication or guarantee of future results. EnerCom is a multi-disciplined management consulting services firm that regularly intends to seek business, or currently may be undertaking business, with companies covered on Oil & Gas 360®, and thereby seeks to receive compensation from these companies for its services. In addition, EnerCom, or its principals or employees, may have an economic interest in any of these companies. As a result, readers of EnerCom’s Oil & Gas 360® should be aware that the firm may have a conflict of interest that could affect the objectivity of this note. EnerCom, or its principals or employees, may have an economic interest in any of the companies covered in this report or on Oil & Gas 360®. As a result, readers of EnerCom’s reports or Oil & Gas 360® should be aware that the firm may have a conflict of interest that could affect the objectivity of this report.