Donald Trump and Kim Jong-un had a historic meeting late last night as the first time a sitting United States President has met with the leader of North Korea. While terms remain vague and no immediate action will take place on part of the US, a deal was penned to completely denuclearize North Korea in exchange for the removal of US forces from South Korea and cessation of aggressive military drills in the area. The equities markets are in a slight buy-the-rumor-sell-the-news mode this morning as they record light losses. US gas and diesel futures are off 50 to 100 points this morning, WTI down just slightly over a dime.
Moderate moves in the energy futures markets will likely be the name of the game until the OPEC meeting Friday of next week. There have been some reports of Saudi Arabia and Russia, one of the major non-OPEC attendees, leaning more towards bolstering production rates. OPEC’s monthly report published early this morning shows The Kingdom is already dialing up the production to make up for setbacks seen in Venezuela, Nigeria, and Libya. The cartel’s total oil production rose by 35mbd last month.
The first tropical disturbance since the end of last month has popped up in the Western Caribbean Sea overnight. The disturbance currently has a 10% chance of developing into a cyclone formation over the next 48 hours but has a greater potential of organization once it moves into the Gulf next week. The first named storm of the 2018 Atlantic Hurricane Season was TS Alberto which made landfall in the panhandle of Florida on May 28th, with little-to-no effect on energy infrastructure in the area.