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Oil hits $50, global commodities dragged higher

Posted on 27 May 2016 by VRS  |  Email |Print

Oil’s advance through $50 a barrel in line with a softer dollar is energising the commodity sector, but bourses are otherwise under pressure as the latest global rally struggles to maintain momentum.
After a mixed Asia-Pacific session, the pan-European Stoxx 600 equity index is slipping 0.2 per cent while US futures point to the S&P 500 easing 0.1 per cent to 2,088, writes Jamie Chisholm. The cautious mood in stocks is encouraging buyers of government bonds, nudging down Treasury yields. The gold price is higher, and so is the yen………………………………………..Full Article: Source

Oil price rises above $50 a barrel

Posted on 27 May 2016 by VRS  |  Email |Print

Data suggests global glut is easing due to fall in US output and supply disruption in Canada, Libya and Nigeria. Oil prices have broken through the $50 per barrel mark for the first time in almost seven months after storage figures suggested that the glut in global crude supplies was easing.
Many analysts have predicted that the recovery, which will help the North Sea oil industry and could steady the global economy but hurt motorists through higher petrol costs, could be short-lived. The price of Brent crude edged up 0.9% to $50.2 a barrel, boosted by data from the US government showing a sharper than expected fall in crude stocks last week, and it later fell back slightly………………………………………..Full Article: Source

Oil Prices Poised to Hit Sweet Spot for Global Economy

Posted on 27 May 2016 by VRS  |  Email |Print

Oil prices, which have been on a jagged rise to near $50 a barrel, are poised to hit a sweet spot for global growth, traders, economists and investors say. On Thursday oil prices rose above $50 a barrel for the first time since November as a combination of supply disruption and declines in U.S. oil inventories raised hopes the oversupplied market was inching toward a better balance.
That puts crude back within a range between $50 and $60 in which almost everybody benefits, economists and investors say. In a so-called goldilocks scenario, oil is not too pricey for consumers and industry, which have benefited from cheap crude for almost two years. But it is priced well enough to help profits in the beleaguered oil industry………………………………………..Full Article: Source

This is what makes OPEC even less relevant

Posted on 27 May 2016 by VRS  |  Email |Print

A series of unexpected disruptions in the world oil market has driven crude to the $50 per barrel level more swiftly than expected — a factor that makes OPEC and its meeting next week less relevant. Both international Brent and West Texas Intermediate crude futures crossed above $50 Thursday, though analysts expect prices to temporarily head lower again in the next couple of months as some supply returns and demand drops off as it does every year after summer driving season peaks.
By year end, however, $50 or above is expected to be the norm. Oil production in the last several weeks has dropped by several million barrels a day due to everything from forest fires in Canada to rebel attacks in Nigeria………………………………………..Full Article: Source

OPEC Likely to Choose New Secretary-General Next Week

Posted on 27 May 2016 by VRS  |  Email |Print

Abdalla Salem el-Badri has been set to retire since 2013 but has stayed on because the fractious oil cartel has been unable to agree a new leader. The Organization of the Petroleum Exporting Countries is likely to choose a new secretary-general at its meeting next week, the only concrete action the cartel is expected to take, said national delegates of the group.
The 13-nation group that controls more than a third of the world’s crude-oil output has been unable to agree on much since petroleum prices began a long swoon nearly two years ago. Once able to swing production up or down to influence prices, OPEC has stayed on the sidelines during this downturn as an American oil boom floods the market and prices remain far below what the group’s members want………………………………………..Full Article: Source

Saudi Arabia Aims to Protect Share of Global Oil Market

Posted on 27 May 2016 by VRS  |  Email |Print

Saudi Arabia is not politicizing the oil problem and is acting solely on economic reasoning in discussion of oil prices and production output, Saudi Foreign Minister Adel al-Jubeir said Thursday. In an interview with Russia Today television, al-Jubeir dismissed assertions that Riyadh was using the oil issue to achieve political goals and insisted that Saudi Arabia approached the current situation on the global oil market solely from the economic standpoint.
“The market determines the oil price depending on demand and offer. The goal of Saudi Arabia is to protect its share of the market and not to support producers that have high oil prices,” the minister stressed………………………………………..Full Article: Source

Oil Is the Odd Commodity Out. Is that Bad for Crude?

Posted on 26 May 2016 by VRS  |  Email |Print

Oil is riding high these days, even as other commodities and emerging markets have turned lower. That may mean one of two things is taking place: Either oil prices will fall back into line, or oil will lose its place a key driver of the financial markets.
The price of West Texas Intermediate crude futures is up 0.6% on the day, on pace to settle at a new 2016 high. It’s on the cusp of climbing back over $50 per barrel, a key psychological level at which firms like Pioneer Natural Resources have said that they’ll look to ramp up production………………………………………..Full Article: Source

Oil price nears seven-month high – will it break $50?

Posted on 26 May 2016 by VRS  |  Email |Print

The oil price broke out of a four-session mini-slump overnight and was hovering close to seven-month highs this morning after a positive report on supply boosted sentiment. US benchmark West Texas Intermediate jumped 2.5 per cent to $49.27 a barrel in afternoon trading in New York yesterday, a new 2016 peak and the highest price since October.
It was holding within 10 cents of this at around 9.45am in London this morning. International benchmark Brent crude peaked last night at around $49.24, around 25 cents below its six-month high of last Monday, and was similarly steady in early London trading………………………………………..Full Article: Source

5 key issues OPEC must wrestle with at its June meeting

Posted on 26 May 2016 by VRS  |  Email |Print

The oil market has given members of the Organization of the Petroleum Exporting Countries a reason to crack a cautious smile at next week’s meeting in Vienna. Signs of a more stable oil market have emerged since the cartel members last held a regularly-scheduled meeting. Oil prices have gained more than 30% so far this year, with West Texas Intermediate crude oil trading at its highest price in seven months in early trade Wednesday on the New York Mercantile Exchange, surpassing $49 a barrel.
Global production is on the decline following a larger-than-expected weekly decline in crude supplies, according to a report from the American Petroleum Institute late Tuesday………………………………………..Full Article: Source

Iran-Saudi row threatens any OPEC deal, puts role in question

Posted on 26 May 2016 by VRS  |  Email |Print

OPEC’s thorniest dilemma of the past year - at least from a purely oil standpoint - is about to disappear. Less than six months after the lifting of Western sanctions, Iran is close to regaining normal oil export volumes, adding extra barrels to the market in an unexpectedly smooth way and helped by supply disruptions from Canada to Nigeria.
But the development will do little to repair dialogue, let alone help clinch a production deal, when OPEC meets next week amid rising political tensions between arch-rivals Iran and oil superpower Saudi Arabia, OPEC sources and delegates say………………………………………..Full Article: Source

Oil Rebound Has Citigroup Seeing Worst Over for Commodities

Posted on 25 May 2016 by VRS  |  Email |Print

The commodities market has turned a corner and prices are unlikely to return to lows seen in the first quarter, according to Citigroup Inc., which boosted forecasts from metals to grains amid an oil-led recovery.
The bottom was likely hit earlier this year when weak fundamentals across all commodities were reinforced by selling after the collapse of China’s equity markets, Citigroup analysts including Ed Morse wrote in a report Tuesday. The bank is now predicting Brent oil will climb to $50 a barrel in the third quarter, earlier than its previous forecast for the fourth quarter, while increasing its year-end gold estimate by $100 an ounce to $1,250………………………………………..Full Article: Source

$65 oil price ‘badly needed’ for investment says Qatar

Posted on 25 May 2016 by VRS  |  Email |Print

Oil markets are rebalancing but crude is not at a fair price yet, Qatar’s energy minister and current Opec president told the Associated Press in an interview published on Tuesday, saying a minimum price of $65 a barrel was “badly needed at the moment”.
“The oil market is recovering slowly but steadily. Luckily, the fundamentals show it is heading in the right direction,” Mohammed Al-Sada was quoted as saying. “I don’t think we are yet at a fair price. We need to have a fairer price so that we can have the ability to invest more in order to secure the energy supply to the world and avoid any price shock,” he said………………………………………..Full Article: Source

OPEC’s Ability to Ease An Oil Supply Shock is Now Fading

Posted on 25 May 2016 by VRS  |  Email |Print

OPEC’s ability to ease the pain of an oil-supply shock is slipping. For half a century, the Organization of the Petroleum Exporting Countries has buffered global crude markets, curtailing production to ease oil gluts and boosting output to prevent shortages.
Now, as it heads into a June 2 meeting to discuss how to stabilize world oil markets, the cartel has neither the political consensus to cut output nor the technical capability to significantly raise production. Since last year, OPEC members haven’t been able to agree on supply cuts to stem a glut that drove prices down by more than 50% since 2014. Instead they kept pumping full blast………………………………………..Full Article: Source

Oil market entering a phase of rebalancing claims Goldman Sachs

Posted on 25 May 2016 by VRS  |  Email |Print

Increased oil production from countries with lower costs is going to hold down the price of crude, according to industry experts at Goldman Sachs. Goldman commodity analysts claim the “new oil order” means that output from the likes of Iran and Iraq will soon entirely offset disruption from higher cost producers.
Recently the oil price has been buoyed by production problems in Canada, Nigeria, and Venezuela. The price of crude came close to crossing the $50 per barrel mark at the end of last week but has since fallen back from the psychological barrier………………………………………..Full Article: Source

Saudi Oil Policy Is Set In Stone

Posted on 25 May 2016 by VRS  |  Email |Print

Next week, OPEC will hold its first meeting since talks on freezing production between the bloc’s major producers and their non-OPEC peers fell apart in April. The June 2 convention will also mark the first time OPEC members have come together in Vienna since Saudi Oil Minister Ali al-Naimi stepped down, making way for Khalid al-Falih to take his place.
Both events have raised questions about what direction Riyadh’s oil policies will take in the months ahead, and how they will affect the kingdom’s relationships with its fellow producers………………………………………..Full Article: Source

Commodities Prices Will Remain Low For Some Time, Here’s Why

Posted on 24 May 2016 by VRS  |  Email |Print

The oil price is recovering. As I wrote in previous pieces, low oil prices are a cure for low oil prices. This is because energy is the foundation of economic activity. Cheap energy is great, but the principle of the ‘greedy algorithm’ where grabbing as much as you can is the way to prosper means it can’t stay extremely cheap for very long.
The read through is that this rally in oil should mean a rally in other natural resources. You might look at gold and say, oil up means gold up means other commodities to follow………………………………………..Full Article: Source

Oil will soon stage a ‘fundamental price recovery’: Analyst

Posted on 24 May 2016 by VRS  |  Email |Print

Supply outages and growing demand from China mean crude prices will come into “much better balance” in the next few months, an energy analyst told CNBC. Jefferies’ Jason Gammel told CNBC on Monday the oil market had swung from oversupply to undersupply in April thanks to disruptions in production in Nigeria and Alberta, Canada, taking around 2 million barrels per day out of the market.
“I think with continued demand growth over the course of this year and continued declines in non-OPEC supply that we are already seeing in places like the United States, the market actually comes into much better balance by the end of the third quarter and that’s the stage for fundamental price recovery,” he told CNBC television in London………………………………………..Full Article: Source

The oil market’s biggest problem is still far from solved

Posted on 24 May 2016 by VRS  |  Email |Print

The worst of the crude oil supply glut may not be over. In the last few weeks, sentiment about the oil market has improved. This happened, in part, after supply disruptions hit Nigeria and Canada. Additionally, Goldman Sachs analysts said the imbalance between supply and demand may be correcting faster than they had expected.
But Adam Longson, head of commodity research at Morgan Stanley, is not yet convinced. In a note Monday, he said the physical oil market is barely responding to supply disruptions. Rising oil storage floating in tankers on the world’s oceans and global gasoline stocks were among the concerning signs he pointed out………………………………………..Full Article: Source

The Market May Crowd Out the OPEC Cartel

Posted on 24 May 2016 by VRS  |  Email |Print

Daniel Yergin’s excellent “Where Oil Prices go From Here” (op-ed, May 16) suggests that shale-oil production in the U.S. will increase once the world’s crude-oil supply and consumption return to balance later this year. This is a very optimistic scenario as it is unlikely that the Saudis will reverse their production policy.
Market forces will also ensure that other members of OPEC will start increasing production rather than sticking to their quotas. This is happening with Saudi Arabia, which is likely to produce 12 million barrels a day within 18 months to counteract the increasing surge in Iranian production. Venezuelan production will also increase within a few years after there is a more oil-company friendly government in power………………………………………..Full Article: Source

What Does The Next OPEC Meeting Have In Store?

Posted on 24 May 2016 by VRS  |  Email |Print

The next OPEC meeting on the 2nd of June will act as little more than a forum for continued altercations between Saudi Arabia and Iran. The 2 June 2016 OPEC meeting will be held amid a backdrop of oil prices near $50 per barrel, a sharp drop in Nigerian production due to sabotage, turmoil in Venezuela, Saudi Arabia operating with a new oil minister, and Iran aggressively pumping close to pre-sanction levels.
OPEC interactions have become a direct altercation between Saudi Arabia and Iran, with the remaining members reduced to mere observers. The new Saudi oil minister, Khalid al-Falih, will be attending his first OPEC meeting, but experts doubt he will have the same clout and skills as the outgoing Saudi oil minister, Ali bin Ibrahim Al-Naimi………………………………………..Full Article: Source

Energy Expert Says Oil Prices Won’t Top $100 a Barrel

Posted on 23 May 2016 by VRS  |  Email |Print

Following a stunning decline, oil prices have clawed back near the $50 level this year. Production boomed in the U.S. but is now slumping. Globally, OPEC is in disarray and major producers can’t agree on steps to boost prices. Daniel Yergin is the vice chairman of research firm IHS Inc. He has written two books on energy, including the Pulitzer-winning opus “The Prize: The Epic Quest for Oil, Money and Power,” which is essential reading for anyone interested in the subject.
Prices where they are today (around $48) are not going to provide a signal for the investment that will be needed to meet demand by 2020, so I think we will see higher prices. But unless there is some big surprise or disruption they wouldn’t go back to $100 a barrel………………………………………..Full Article: Source

Tom Ward: The ‘dirty little secret’ about $50 oil

Posted on 23 May 2016 by VRS  |  Email |Print

Chesapeake Energy co-founder Tom Ward said Friday that oil prices need to recover to about $75 a barrel in order for most drillers to ramp up production. Crude futures have recently approached $50 a barrel after rebounding more than 80 percent from this year’s lows in the mid-$20 range.
Some worry those prices will incentivize high-cost U.S. oil producers to put more rigs to work, worsening a global supply glut and putting off a sustainable price recovery. U.S. oil production has fallen from a high of nearly 9.7 million barrels per day last year to about 8.8 million barrels per day………………………………………..Full Article: Source

Iran Won’t Freeze Oil Output Before OPEC Meeting

Posted on 23 May 2016 by VRS  |  Email |Print

Iran, which is due to meet with OPEC partners on June 2, has no plan to join any freeze in crude output as the country won’t be done ramping up oil exports to pre-sanctions levels before the second half of the year, the head of the state oil company said.
The Persian Gulf state’s oil exports will likely surpass 2.2 million barrels a day by the middle of the summer, Rokneddin Javadi, managing director of National Iranian Oil Co., told Mehr news agency. Iran last exported at this level before sanctions were imposed on the country for its nuclear program more than four years ago. Sanctions were eased in January, and Iranian officials said they won’t discuss any output freeze or cut before reaching pre-sanctions levels………………………………………..Full Article: Source

Kuwait wants Iran in oil freeze deal

Posted on 23 May 2016 by VRS  |  Email |Print

Kuwait said on Friday that it is in favor of signing an agreement to freeze oil production at the OPEC summit in early June, but emphasized that such an agreement will be impossible without the participation of Iran.
The announcement was made by Abdulaziz al-Adwani, Kuwait’s ambassador to Russia. Al-Adwani has told the Russian news agency Interfax that Kuwait wants an agreement to freeze oil production to be reached at the upcoming OPEC summit, but that agreement should also include Iran. Such a step would be effective and impact the oil price if Iran also agreed to it, he said……………………………………….Full Article: Source

OPEC Set for Another Meeting With No Deal After Doha Failure

Posted on 23 May 2016 by VRS  |  Email |Print

After failing to reach an accord on oil supply in Doha last month, OPEC is poised to go another meeting with no agreement on how much crude to produce. All but 1 of 27 analysts surveyed by Bloomberg said the Organization of Petroleum Exporting Countries won’t set an output target on June 2, as it sticks with Saudi Arabia’s strategy to squeeze out rivals including U.S. shale drillers by pumping near-record volumes.
An accord on an output cap with non-members such as Russia collapsed in Doha last month when Saudi officials insisted Iran would need to take part………………………………………..Full Article: Source

How The U.S. Dollar Influences Oil Prices

Posted on 23 May 2016 by VRS  |  Email |Print

Crude oil has reached a critical technical level, which is likely to test the resolve of the bulls to push prices higher. The bulls have a favorable tailwind with production outages reducing the supply glut. Till about two weeks ago, the drop in the U.S. dollar was also supportive of the crude oil prices, but since then, the dollar has recovered, putting pressure on the crude oil prices.
The U.S. dollar and the various commodities have an inverse correlation. The chart below shows the correlation between crude and the U.S. dollar index for the past 12 years………………………………………..Full Article: Source

Saudi Kills US Shale Oil Industry and Buys it for Pennies

Posted on 20 May 2016 by VRS  |  Email |Print

The Saudi Kingdom saw American oil companies invest in the research and development of oil fields and fracking, and then crashed the market so they could scavenge US natural resources and technology on the cheap.
In 2015, the world stared into a global economic recession, with startling downgrades for Chinese economic growth due to an explosion in their stock market, fueled by speculative excess. While the Chinese economy roiled, unrest brewed in much of the world, including in the war-torn Middle East and on European shores, upon which refugees descended en masse. Even the US economy, once stoked by a shale oil renaissance, was not spared the effects………………………………………..Full Article: Source

Oil could easily be headed back to $35 a barrel

Posted on 20 May 2016 by VRS  |  Email |Print

After a long and eventful decline in prices, the crude-oil market has suddenly been experiencing the other side of the supply-demand coin, something that it has not had to deal with in a while: a bull run cobbled together from a series of unplanned supply outages.
It started last month, with the Kuwait oil workers’ strike, and those lost barrels were added to lost production from seemingly everywhere, ranging from the North Sea to Libya and Nigeria. The ongoing wildfire in the tar sands region of Canada was another outlier event, knocking out over 1 million barrels of production per day………………………………………..Full Article: Source

Oil prices have probably bottomed: Woodside

Posted on 20 May 2016 by VRS  |  Email |Print

Woodside Petroleum chief Peter Coleman says oil prices have probably bottomed and are likely to firm, but he doesn’t think a strong rebound is on the cards, warning prices will remain “rangebound” as gains inspire more production.
Coleman is fronting investors in Sydney this morning in the company’s annual investor briefing day. “We think there will be a firming over the next 18 months,” Mr Coleman said. “We’re not going to see any real increase in prices … but we’ve probably bottomed out in a range.”……………………………………….Full Article: Source

What Does The Next OPEC Meeting Have In Store?

Posted on 20 May 2016 by VRS  |  Email |Print

The next OPEC meeting on the 2nd of June will act as little more than a forum for continued altercations between Saudi Arabia and Iran. The 2 June 2016 OPEC meeting will be held amid a backdrop of oil prices near $50 per barrel, a sharp drop in Nigerian production due to sabotage, turmoil in Venezuela, Saudi Arabia operating with a new oil minister, and Iran aggressively pumping close to pre-sanction levels.
OPEC interactions have become a direct altercation between Saudi Arabia and Iran, with the remaining members reduced to mere observers………………………………………..Full Article: Source

OPEC strategy working as Kuwait sees oil rising to $50

Posted on 20 May 2016 by VRS  |  Email |Print

OPEC’s strategy to defend market share rather than target a price is working as crude gains amid rising demand and declining output from producers including U.S. shale wells, Kuwait’s acting oil minister said.
Oil will end the year at $50/bbl and the market will rebalance in the third or fourth quarter, Anas Al-Saleh said in an interview Wednesday in Kuwait City. Kuwait will stick to OPEC’s strategy of pumping to win customers, he said. Demand is growing and about 3 MMbpd of crude supply have been lost to interruptions or because some producers have been priced out of the market, he said………………………………………..Full Article: Source

Will oil at $50/barrel worry India?

Posted on 20 May 2016 by VRS  |  Email |Print

While oil that plunged below $30 a few months ago helped India contain inflation and shrink its trade deficit, a rebound to $50 has other advantages for the world’s fastest-growing importer of crude. More cash for fuel exporters could boost global growth, lure commodity-dependent sovereign wealth funds back to emerging markets and increase demand for Indian-made goods, including petroleum products.
“The environment might be better rather than worse for India,” said Sonal Varma, an economist at Nomura Holdings in Mumbai. Oil at “$60, $65, $70 — that’s when the problem starts, but right now I think it’s fine.”……………………………………….Full Article: Source

Kuwait Says Oil Near $50 Shows OPEC’s Strategy Is Working

Posted on 19 May 2016 by VRS  |  Email |Print

OPEC’s strategy to defend market share over prices is working as oil approaches $50 a barrel amid rising demand and declining output from producers including U.S. shale companies, Kuwait’s acting oil minister said.
Oil will end the year at $50 a barrel and the market will rebalance in the third or fourth quarter of the year, Anas Al-Saleh, the acting oil minister, said in an interview Wednesday in Kuwait City. Demand is growing and about 3 million barrels a day of crude supply have been lost due to a drop in global production, he said………………………………………..Full Article: Source

Five things to watch for as oil nears $50 a barrel

Posted on 19 May 2016 by VRS  |  Email |Print

There are key factors that can fuel crude beyond $50 or stall the near 80% price rally. As the price of crude oil nears $50 a barrel for the first time this year, traders are split over whether the near 80 per cent rally since prices bottomed in January can keep going.
Here are five things to watch that could dictate the next move in the price of Brent crude, currently trading near $49 a barrel, and US benchmark West Texas Intermediate which is more than $48. 1. Nigeria and other troubled Opec producers: The latest leg up in prices comes as output in what was Africa’s largest producer has fallen to the lowest level in more than 20 years………………………………………..Full Article: Source

Oil outages speeding up new world energy order

Posted on 19 May 2016 by VRS  |  Email |Print

The world’s oil market is rebalancing faster than expected due to several serious outages, but for now there is enough oil in storage and excess capacity to keep prices from spiking.
“We’ve strung together an impressive number of outages and supply disruptions for the moment, but there’s every incentive in the dire straits the industry’s been in to get these barrels on line,” said John Kilduff, partner with Again Capital………………………………………..Full Article: Source

It’s Saudi Arabia’s World. Big Oil Just Lives In It

Posted on 19 May 2016 by VRS  |  Email |Print

When Saudi Arabia nationalized its oil industry in 1980, it marked the end of an era dominated by western majors such as Exxon, Chevron and BP. The proposed re-privatization of those same oilfields threatens to upend their world once again. Getting kicked out of the Middle East forced the majors to exploit other tourist traps, such as the North Sea.
Like OPEC, they assumed the value of their reserves of this finite, critical commodity would, more or less, keep rising over time. So a barrel not produced today, even if it cost a lot to find or acquire, is effectively money in the bank. This is why the majors obsess over their reserves replacement ratio, measuring how many new barrels come in to replace the ones they pump out………………………………………..Full Article: Source

Where Oil Production Is Set To Soar… And It’s Not OPEC

Posted on 19 May 2016 by VRS  |  Email |Print

Oil prices have been on the rise lately and the market appears to be heading very quickly toward rebalancing, which is very positive for long-oriented investors in this space. While this is all true, however, one area will make any such oil recovery harder than it otherwise would be.
This is the Gulf of Mexico, which is the one place for U.S. production where low prices have not caused output to crash………………………………………..Full Article: Source

Oil market unlikely to rebalance fully by year-end: Total CEO

Posted on 19 May 2016 by VRS  |  Email |Print

Oil demand in 2016 will stay strong, supporting prices, but the market is unlikely to rebalance by the year end, the chief executive of French oil and gas major Total said. Patrick Pouyanne told a French Senate committee that oil demand rose sharply in 2015 to 1.8 million barrels per day (bpd), increasing at about 2 percent in a single year.
“This year, experts see demand at about 1.2 million barrels per day,” Pouyanne said. “Me and my team see it at about 1.4 million barrels per day, which is still strong and means the market is rebalancing, but will not rebalance completely by the end of the year, however, it will somehow support prices,” he added………………………………………..Full Article: Source

How To Play The Oil Price Rebound

Posted on 18 May 2016 by VRS  |  Email |Print

It’s not surprising that skepticism persists about signs of an oil industry rebound. After all, the sharp decline in oil prices since mid-2014 brought huge damage to a lot of industries and the stock market — particularly to investors in energy stocks. Indeed, the surprise 75% decline in oil has been a tough headwind to global growth.
So how real is the oil reversal? “Our assumption is that the recent price rebound is durable and mostly grounded in fundamentals,” says Lisa Shalett, chief of investment and portfolio strategies at Morgan Stanley Wealth Management, in a note to clients………………………………………..Full Article: Source

Is Saudi Arabia calling the market’s bluff over oil?

Posted on 18 May 2016 by VRS  |  Email |Print

Oil market watchers have been keeping a close eye on Saudi Arabia ever since it announced last month that it could very well increase oil production if and when it wanted to, but analysts at Energy Aspects explained on Tuesday that the major oil producer could be calling the market’s bluff.
Saudi Arabia threatened to boost its already record-breaking oil output following the failure of a meeting of OPEC and non-OPEC producers in Doha in April to discuss a possible freeze of global oil production at current levels in an effort to support low oil prices………………………………………..Full Article: Source

Oil nears $50 mark

Posted on 18 May 2016 by VRS  |  Email |Print

What oil glut? Oil Futures continued to advance early Tuesday amid concern over the impact week-long wildfires in Canada have had on that country’s output as well as security fears in producers Nigeria, Libya and the Middle East.
International Benchmark Brent crude appeared to be stroking the $50 mark on Tuesday rising 0.71 per cent to $49.32. US Benchmark West Texas intermediate was trading at $48.28, up 1.17 per cent from Monday’s close. Meanwhile, global banker Goldman Sachs has revised its forecast for oil futures in 2016 and 2017 saying that the price of a barrel of oil will likely be around $50 this year and reach $60 by the end of 2017………………………………………..Full Article: Source

Algeria signs oil, gas deal as OPEC member seeks to boost sales

Posted on 18 May 2016 by VRS  |  Email |Print

Algeria will supply oil and other energy products to Jordan for the first time under a memorandum of understanding signed on Monday, as the OPEC member seeks to diversify sales after years of stagnating crude production.
Algeria’s state-run Sonatrach Group will start shipping liquefied natural gas and liquefied petroleum gas to Jordan in September, followed by crude oil, Algerian Energy Minister Salah Khebri said in an interview in Amman on Monday. Sonatrach and National Electric Power Co. of Jordan should reach a final agreement in the next few weeks, he said, without specifying shipment volumes. Sonatrach will also explore for oil and gas in Jordan………………………………………..Full Article: Source

Goldman cuts 2017 oil price forecasts, raises short term view

Posted on 17 May 2016 by VRS  |  Email |Print

Goldman Sachs says “the oil market has gone from nearing storage saturation to being in deficit much earlier than we expected and we are pulling forward our price forecast, with second quarter/second half of 2016 WTI now $45/bbl and $50/bbl.”
Goldman says forecasts a more gradual decline in inventories in second half than previously and a return into surplus in first quarter 2017, with low-cost production continuing to grow in the new oil order. Goldman Sachs says lowering its 2017 forecast from $57.5/bbl to $52.5/bbl, with a first quarter 2017 decline back to $45/bbl and a recovery to $60/bbl by fourth quarter 2017………………………………………..Full Article: Source

Algeria Signs Oil, Gas Deal as OPEC Member Seeks to Boost Sales

Posted on 17 May 2016 by VRS  |  Email |Print

Algeria will supply oil and other energy products to Jordan for the first time under a memorandum of understanding signed on Monday, as the OPEC member seeks to diversify sales after years of stagnating crude production.
Algeria’s state-run Sonatrach Group will start shipping liquefied natural gas and liquefied petroleum gas to Jordan in September, followed by crude oil, Algerian Energy Minister Salah Khebri said in an interview in Amman. Sonatrach and National Electric Power Co. of Jordan should reach a final agreement in the next few weeks, he said, without specifying shipment volumes. Sonatrach will also explore for oil and gas in Jordan………………………………………..Full Article: Source

‘Big Oil Worry’: Nigeria’s Chaos Adds to Increasing Fuel Prices

Posted on 17 May 2016 by VRS  |  Email |Print

The ongoing crisis in Nigeria adds significantly to the current increase in global oil prices, according to Bloomberg. Bloomberg’s Julian Lee believes that the political standoff in Nigeria has added greatly to upward pressure on global oil prices.
In his article ‘Forget the Saudis, Nigeria’s the Big Oil Worry’, Lee said that apart from “Saudi Arabia’s oil market machinations,” policymakers should also be concerned about what is now “happening 3,000 miles away in the Niger River delta.” ……………………………………….Full Article: Source

It’s too early for the oil market to say farewell to oversupply

Posted on 17 May 2016 by VRS  |  Email |Print

The oil market has started to bid adieu to the global glut of crude supplies—but the goodbyes may be premature. Although some traders and analysts agree that the world’s crude oversupply, which has plagued the market for more than two years, is dwindling or slipping into a deficit, few believe it’s a situation that’s likely to last long.
“Outages in Canada and Nigeria are helping to bring the market into balance, but these outages are more temporary in nature,” said Matt Smith, director of commodity research at ClipperData………………………………………..Full Article: Source

European Oil Demand to Stagnate this Year, Says OPEC

Posted on 17 May 2016 by VRS  |  Email |Print

European oil demand is stagnating after a warm winter in the first quarter coupled with the fading impact of low prices halted the growth seen last year, according to OPEC’s monthly report. Downside risks to demand are also multiplying from the debt pile weighing on several countries, high taxes in the transportation sector, and rising sales of hybrid or electric cars.
European oil demand is expected to grow just 10,000 b/d this year compared to 260,000 b/d last year, the OPEC analysts estimate. Demand fell 120,000 b/d in the big four countries of Germany, France, Italy and the U.K. in March from a year earlier, the report notes………………………………………..Full Article: Source

Where Oil Prices Go From Here

Posted on 16 May 2016 by VRS  |  Email |Print

Leaders of major oil-exporting countries used to talk about “saving the oil” for their grandchildren. But now the grandchildren are in charge, and they want to monetize the oil.
That is certainly so in Saudi Arabia, where Deputy Crown Prince Mohammed bin Salman—a grandson of the country’s founder, Abdul Aziz ibn Saud—has launched an ambitious plan to reduce the country’s dependence on oil. Decrees issued this month announced far-reaching changes in Saudi ministers and government organization………………………………………..Full Article: Source

OPEC report predicts oil-price rise

Posted on 16 May 2016 by VRS  |  Email |Print

According to OPEC, prices are set to surge due to high exploration costs, while population and economic growth will also result in a spike in demand for oil A recent report released by the Organization of the Petroleum Exporting Countries (OPEC) has predicted that oil prices are set to recover to $70 a barrel by 2020.
Brent crude oil prices have fallen from more than $110 a barrel in 2014 to less than $28 a barrel in January 2016 (the lowest since 2004) due to oversupply and slowing demand………………………………………..Full Article: Source

Big Oil’s Big Plans for New Gas Markets

Posted on 16 May 2016 by VRS  |  Email |Print

Producers hope to create new markets to boost demand to drag LNG prices out of the doldrums. Natural gas transported across the world’s oceans by ship has helped to displace coal burned in European power plants and Chinese household cookers. Now, producers want it to become a fuel for cruise liners, container ships and road trucks.
In doing so, Big Oil hopes to boost demand by enough to drag prices of liquefied natural gas out of the doldrums. LNG prices last month sank to a seven-year low in Asia as demand failed to keep up with rising supply from countries including the U.S. and Australia………………………………………..Full Article: Source

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