Turning From Syria To The Supply Side For Crude

After President Obama spoke Tuesday evening, it now looks increasingly likely that a Russian diplomatic option will be the more probable outcome for Syria.

With that in mind we've seen the oil complex sell-off over the last few sessions and attention will now move to supply side issues.

Interestingly they too seem to be adding to the bullish tone in oil that we've been seeing for the last couple of months.

On Tuesday, OPEC cut its August oil output to 29.93 million barrels a day, the lowest level in two years, according to a monthly report from the.EIA.

Prior to the Syrian crisis, there was a sharp reduction in oil output from Libya amid strikes at the country's oil-export terminals.

Another OPEC report Tuesday showed that Saudi Arabia and Iraq have made up for some of the losses in Libyan production,adding to supply.

I've been looking to potentially short some spreads in crude and heating oil as they've been trading at levels that I would consider too wide by historical standards, however with the bullish undertone I'm hesitant at the moment.

Wait and see for now.