Fri, Mar 27, 2015
A A A
Welcome preal121
RSS

Commodities Briefing - Category | Oil more

Oil prices rise after fears of more violence in Gulf

Posted on 27 March 2015 by VRS  |  Email |Print

Bombing of Yemen spooks investors into believing supply lines could be affected and causing crude to jump 4% on global markets. Oil prices surged on global markets as jumpy investors weighed the risk that tensions in Yemen could spiral into a wider Middle East conflict, choking off crude supplies.
The cost of a barrel of benchmark Brent crude rose more than 4% on Thursday, to $58.93 (£39.55), after reports emerged about Saudi-led air strikes on the Yemeni capital, Sana’a, and the southern port city of Aden – close to the key oil supply route through the Gulf of Aden and the Suez canal. A barrel of US West Texas intermediate jumped $2.17, to $51.37………………………………………..Full Article: Source

Oil market’s small fry become big fish

Posted on 27 March 2015 by VRS  |  Email |Print

Like the old cartoon showing a school of small fish organised to form a big one, retail investors have become a whale in the oil market. Uniting as buyers of exchange traded funds, these investors held 180m barrels equivalent of West Texas Intermediate crude futures last week — 30 per cent of the most active futures market.
The resurfacing of oil ETFs is a sign some investors are again warming to commodities as an asset class after years of poor performance. But analysts and some fund managers warn that the fat returns of the previous decade are over and the “supercycle”, the long period of tightness in markets from oil to copper that drove these returns, has rumbled to a halt………………………………………..Full Article: Source

The oil price has bottomed out – here’s why

Posted on 27 March 2015 by VRS  |  Email |Print

The oil price has been crushed since last summer. It’s gone from over $100 a barrel (both Brent and WTI, the main benchmarks) to as low as below $50. Two main factors have driven this: a healthy supply of oil, and strong demand for US dollars. But both those trends look at risk of reversing. And that could mean a rebound for oil.
Oil prices spiked higher yesterday, as Saudi Arabia launched air strikes on Yemen. The price of Brent went up to nearly $60 a barrel, while WTI (the US benchmark) rose to around $52. As ever in the Middle East, the details are complicated (we’ll look into it in more detail in the next issue of MoneyWeek magazine). But keeping things simple, the Saudis and other Gulf Arab states are fighting Iran-backed rebels in Yemen, in an attempt to defend the Yemeni government………………………………………..Full Article: Source

Iraq oil minister sees $70 crude by end 2015

Posted on 27 March 2015 by VRS  |  Email |Print

Iraq’s Oil Minister Adel Abdel Mehdi predicted world oil prices could reach $70 a barrel by the end of 2015 and played down the impact of the emerging conflict in Yemen on prices. A global slump in oil prices has slashed government revenue in Iraq, prompting the OPEC producer to renegotiate contracts with oil majors as it faces a costly military campaign against Islamic State militants.
“In January prices reached the bottom and they can’t go any lower than that,” Abdel Mehdi told Reuters in an interview on Thursday. “Now they’re going up, slowly but steadily. They will go up and maybe reach $70 by the end of the year”. Brent oil rallied for a second straight day on Thursday to more than $59 a barrel after Saudi Arabia and its Gulf Arab allies launched air strikes in Yemen, sparking fears of a wider regional confrontation that could disrupt world crude supplies………………………………………..Full Article: Source

Iraq supports Opec policy to defend market share

Posted on 27 March 2015 by VRS  |  Email |Print

Iraq supports the Organization of the Petroleum Exporting Countries (Opec’s) policy of defending the group’s market share by keeping oil production steady, an Iraqi parliamentary oil official said, despite pressure on the Arab state’s budget.
The Opec holds its next meeting in June and so far looks set to keep policy unchanged. Adanan Al Janabi, Iraq’s chairman of oil and energy parliamentary committee, said this would be a move he agreed with. “Iraq is with the general consensus of Opec that we should not be fighting for the price but rather for market share,” he told reporters on the sidelines of an industry event in Doha………………………………………..Full Article: Source

Call option trades target return of $100 US crude oil

Posted on 26 March 2015 by VRS  |  Email |Print

The prospect of a return to $100-a-barrel crude is tempting some to bet against the bearish consensus in the oil market. One or more traders have resumed buying call options that pay out if benchmark US crude futures surpass $100 by the end of 2018. Call options give holders the right to buy oil at a set price by a certain date.
Open interest in these options has risen to the equivalent of 2.7m barrels, nearly trebling from the start of the month. The bullish positions run counter to the downbeat sentiment that pervades the oil market. Despite cutbacks in drilling, the price of West Texas Intermediate crude for December 2018 delivery was $64.25 a barrel on Wednesday. This specific futures contract last traded above $100 a barrel in mid-2011, while spot US crude oil was at that level last July………………………………………..Full Article: Source

Oil production growth means no quick price fix

Posted on 26 March 2015 by VRS  |  Email |Print

Oil prices were in recovery Wednesday after a three-week slide that took West Texas Intermediate crude to a six-year low last week. But a new report today warns that oil prices are unlikely to bounce back as quickly as they did in 2009, when they plunged to $33 US a barrel but recovered within three years.
That’s because both Canada and the U.S. continue to produce more oil in the face of a global glut in crude production. WTI was trading up $1.46 at $48.97 a barrel on Wednesday. That’s down 7.6 per cent since the beginning of the year and less than half the $107 it hit last June. But the price bounce defies news from the U.S. Energy Information Administration today that crude inventories rose by 8.2 million barrels last week, setting an 80-year high………………………………………..Full Article: Source

Global Demand To Help Oil Prices Despite U.S. Glut- Senior Gulf OPEC Delegate

Posted on 26 March 2015 by VRS  |  Email |Print

The comments appear to counter some market forecasts that the U.S. oil glut may push prices to as low as $20-$30. Stronger-than-expected global oil demand should help support crude prices at around $55-$60 a barrel in the next two months despite some signs of a growing glut in the United States, a senior Gulf OPEC delegate told Reuters on Tuesday.
The comments appear to counter some market forecasts that the U.S. oil glut may push prices to as low as $20-$30 and are a sign that the core Gulf OPEC members remain confident about their strategy of defending market share. “Global demand is definitely growing much stronger than expected. In December, January, and especially February it was beyond what forecasts anticipated,” the delegate said………………………………………..Full Article: Source

Iraq supports OPEC policy to defend market share - official

Posted on 26 March 2015 by VRS  |  Email |Print

Iraq supports OPEC’s policy of defending the group’s market share by keeping oil production steady, an Iraqi parliamentary oil official said on Wednesday, despite pressure on the Arab state’s budget.
The Organization of the Petroleum Exporting Countries (OPEC)holds its next meeting in June and so far looks set to keep policy unchanged. Adanan Al-Janabi, Iraq’s chairman of oil and energy parliamentary committee, said this would be a move he agreed with. “Iraq is with the general consensus of OPEC that we should not be fighting for the price but rather for market share,” he said………………………………………..Full Article: Source

Here’s How $20 Oil Could Become a Reality If Storage Runs Out

Posted on 25 March 2015 by VRS  |  Email |Print

There’s the makings of a crisis swirling in America’s oil-storage tanks, and the next few months will determine whether it’s a minor annoyance, or a major blow, to U.S. oil. The basic problem is that too much oil is being pumped, and not enough is being used up. America is running out of places to store all of the excess crude. That’s a problem, and it could send prices plummeting — some say to $20 a barrel or even lower. (For context: Last summer it was more than $100, and today it’s less than $50.)
That’s probably not going to happen, but it’s not as crazy as it might first sound. Stockpiles are at record-high volumes after 10 straight weeks of increases. The U.S. is currently accumulating an extra one to two million barrels a day more than its using. The oil imbalance is bad, and it’s still getting worse………………………………………..Full Article: Source

Why oil could be going back to $70

Posted on 25 March 2015 by VRS  |  Email |Print

Oil has fallen too far too fast, and benchmark Brent crude could be back at $70 or $80 per barrel, the CEO of Signal Investment Research said Tuesday. Stephen Davis said he sees oil prices bouncing $10 In the next three to six months and believes prices could go much higher.
“The price of [Brent] oil has come down $55, which is a huge amount for the amount that we’re oversupplied,” he said. “People think it’s just because we’re oversupplied, but there’s a lot of reasons why we’re oversupplied, and those factors will reverse.”……………………………………….Full Article: Source

Global demand to help oil prices despite U.S. glut-senior Gulf OPEC delegate

Posted on 25 March 2015 by VRS  |  Email |Print

Stronger-than-expected global oil demand should help support crude prices at around $55-$60 a barrel in the next two months despite some signs of a growing glut in the United States,‎ a senior Gulf OPEC delegate told Reuters on Tuesday.
The comments appear to counter some market forecasts that the U.S. oil glut may push prices to as low as $20-$30 and are a sign that the core Gulf OPEC members remain confident about their strategy of defending market share. “Global demand is definitely growing much stronger than expected. In December, January, and especially February ‎it was beyond what forecasts anticipated,” the delegate said………………………………………..Full Article: Source

Non-OPEC members must cooperate to boost oil price - Al Naimi

Posted on 25 March 2015 by VRS  |  Email |Print

Members of the Organisation of the Petroleum Exporting Countries (OPEC) cannot be held solely responsible for the drop in oil prices, Saudi Arabia’s veteran oil minister has said. Ali Al Naimi called on non-OPEC members to cooperate in helping to raise the crude oil price, which has lost about 60 percent since mid-2014.
“GCC countries have made serious efforts to balance oil prices, but the prices are set by the market,” he said. “We refuse to take responsibility alone because OPEC produces 30 percent of market output and 70 percent comes from outside.”……………………………………….Full Article: Source

Why current oil prices don’t tell the energy sector’s whole fortune

Posted on 25 March 2015 by VRS  |  Email |Print

Investors in the Canadian energy sector have certainly felt the pain of plunging oil prices, as the S&P/TSX Energy Index is down more than 25% since June 2014, but some say things could be worse.
Oil has fallen roughly 60% during the same period, after peaking near US$107 per barrel, yet Canadian Natural Resources Ltd., Suncor Energy Inc. and other names in the benchmark Canadian energy index are still trading at a lofty 65x forecasted fourth-quarter earnings………………………………………..Full Article: Source

Progress in Iran talks puts oil traders on edge

Posted on 25 March 2015 by VRS  |  Email |Print

Talk of progress in the nuclear negotiations between Iran and the world powers has had oil traders on edge. With large amounts of Iranian oil already in storage, an injection of hundreds of thousands of barrels a day into the oil market already struggling with a crude overhang could depress prices further.
The prospect of a wave of Iranian crude exports has already hit internationally traded Brent: after rebounding to $60 a barrel last month, it now hovers around $55 a barrel amid expectations of a deal by March 31………………………………………..Full Article: Source

The price of oil is going lower: Trader

Posted on 24 March 2015 by VRS  |  Email |Print

With OPEC signaling over the weekend that it would not change course and cut production, expect oil prices to fall even lower, trader Jeff Kilburg said Monday. Traders are “looking for more of a bearish short-term output,” the founder of KKM Financial said.
On Sunday, Saudi Arabia’s oil minister said it will not take sole responsibility for propping up the oil price and will keep production unchanged. Kilburg said the kingdom is actually producing more oil, noting the oil minister said it is pumping about 350,000 more barrels of crude a day………………………………………..Full Article: Source

Crude oil prices heading to $35 by June: FGE

Posted on 24 March 2015 by VRS  |  Email |Print

Global crude oil prices could trade between $35 to $40 a barrel by the end of the second-quarter of 2015, according to one of the world’s leading oil experts. Prices could even dip beyond those levels for a brief period, warned Fereidun Fesharaki, chairman of FACTS Global Energy (FGE).
Brent crude was trading 1.63% lower to $54.42 a barrel at 08.26am on 23 March. US crude was trading 2.10% lower to 45.59 a barrel. The outlook could get worse if the US and Iran reach a nuclear deal. A former energy advisor to Iran, Fesharaki believes there is an 80% chance of the deal going though before the 31 March deadline, which could see a further $5 drop in oil prices………………………………………..Full Article: Source

Oil Starts Move Down to $20

Posted on 24 March 2015 by VRS  |  Email |Print

CNBC ran an article about a prediction by FACTS Global Energy that oil could drop to $35 a barrel soon, and then go much lower. Saudi officials say they will keep production at the levels they are now. Slowing economies in the European Union and China will cripple demand for crude. Citigroup analysts have not retracted their prediction that oil will drop to $20. The forecasts of a collapse of oil prices, so loud in February, have returned.
While some of the forecasts for the fall in oil prices are bogus, others have some merit. Perhaps companies holding crude will find more tankers to keep oil out at sea. No one knows how many tankers that might be, or whether their capacity has been filled………………………………………..Full Article: Source

Keeping oil below $100 will shut shale out of market, says Saudi official

Posted on 24 March 2015 by VRS  |  Email |Print

Oil prices won’t rebound to $100 a barrel because increased prices would draw more shale and other output from higher-cost producers to the market, said Mohammad al-Madi, Saudi Arabia’s governor to OPEC. “I think it will be difficult to reach $100 or $120 another time,” Madi said at a conference in Riyadh on Sunday. “This will let the high-cost producers come back again.”
Saudi Arabia, the nation leading OPEC in defending its share of the global oil market, will keep investing to maintain its current output capacity, he said. Brent oil, the global benchmark, declined almost 50 percent in the past year as Saudi Arabia and others in the Organization of Petroleum Exporting Countries committed to maintaining output amid a global surplus. U.S. output is the highest in three decades as drillers pump crude from shale………………………………………..Full Article: Source

Oil won’t breach $100 again - OPEC exec

Posted on 24 March 2015 by VRS  |  Email |Print

Oil prices won’t rebound to $100 a barrel because increased prices would draw more shale and other output from higher-cost producers to the market, according to Saudi Arabia’s governor to OPEC.
“I think it will be difficult to reach $100 or $120 another time,” Mohammed al-Madi said at a conference in Riyadh yesterday. “This will let the high-cost producers come back again.” Saudi Arabia, the nation leading OPEC in defending its share of the global oil market, will keep investing to maintain its current output capacity, he said………………………………………..Full Article: Source

Lower oil prices proving a bonus for China even as demand falls

Posted on 24 March 2015 by VRS  |  Email |Print

The “new normal” of lower growth that premier Li Keqiang talks about is also having an impact on demand for oil and other commodities. Lower prices for oil and other commodities are delivering China serious savings in its purchases of oil, iron ore and copper – by some estimates up to €232 billion a year.
At the same time, China, the world’s number two oil consumer, topped up its strategic petroleum reserves last year with cheap crude and now the tanks are nearly full. China’s goal is to fill the tanks to have a 90-day supply by 2020, from a current level of 30-40 days………………………………………..Full Article: Source

Hedge funds get short of US oil as storage fills

Posted on 24 March 2015 by VRS  |  Email |Print

Hedge funds have turned super-bearish about US oil prices as concerns about running out of storage trump the drop in the number of rigs drilling new wells. Money managers had amassed a record number of short positions in futures and options contracts linked to WTI (West Texas Intermediate) by the end of March 17, equivalent to 209 million barrels of oil, according to the US Commodity Futures Trading Commission’s (CFTC) latest commitments of traders report published on Friday.
Money managers still have long positions equivalent to 381 million barrels, so overall the sector is still running a net long position. Hedge fund managers have a natural bullish bias. Not once have hedge funds as a whole been net short of WTI futures and options in the last nine years………………………………………..Full Article: Source

Return to $100 Oil Seen Unlikely by Saudis Amid Shale Surge

Posted on 23 March 2015 by VRS  |  Email |Print

Oil prices won’t rebound to $100 a barrel because increased prices would draw more shale and other output from higher-cost producers to the market, said Mohammed al-Madi, Saudi Arabia’s governor to OPEC.
“I think it will be difficult to reach $100 or $120 another time,” al-Madi said at a conference in Riyadh on Sunday. “This will let the high-cost producers come back again.” Saudi Arabia, the nation leading OPEC in defending its share of the global oil market, will keep investing to maintain its current output capacity, he said………………………………………..Full Article: Source

OPEC won’t support oil’s price alone, says Saudi minister

Posted on 23 March 2015 by VRS  |  Email |Print

OPEC will not take sole responsibility for propping up the oil price, Saudi Arabia’s oil minister said on Sunday, signalling the world’s top petroleum exporter is determined to ride out a market slump that has roughly halved prices since last June.
Last November, the Organization of Petroleum Exporting Countries kingpin Saudi Arabia persuaded members to keep production unchanged to defend market share. The move accelerated an already sharp oil price drop from peaks last year of more than $100 (U.S.) a barrel that was precipitated by an oversupply of crude and weakening demand………………………………………..Full Article: Source

Keeping oil below $100 will shut shale out of market: Saudi official

Posted on 23 March 2015 by VRS  |  Email |Print

Oil prices won’t rebound to $100 a barrel because increased prices would draw more shale and other output from higher-cost producers to the market, said Mohammad al-Madi, Saudi Arabia’s governor to OPEC. “I think it will be difficult to reach $100 or $120 another time,” Madi said at a conference in Riyadh on Sunday. “This will let the high-cost producers come back again.”
Saudi Arabia, the nation leading OPEC in defending its share of the global oil market, will keep investing to maintain its current output capacity, he said. Brent oil, the global benchmark, declined almost 50 percent in the past year as Saudi Arabia and others in the Organization of Petroleum Exporting Countries committed to maintaining output amid a global surplus. U.S. output is the highest in three decades as drillers pump crude from shale………………………………………..Full Article: Source

Oil Price Drop Hurts Spending on Business Investments

Posted on 23 March 2015 by VRS  |  Email |Print

Prospects for an uptick in business investment this year are facing a major drag: The collapse in oil prices is spurring significant cutbacks by the energy-production industry, which had been a standout in an otherwise lackluster U.S. economic expansion.
Business capital spending rose 6% last year due to gains from a broad base of U.S. industries. The drag from energy this year could cut that growth rate in half in 2015, according to economists at Goldman Sachs………………………………………..Full Article: Source

Kuwait Says OPEC Has No Choice But to Keep Oil Production Target

Posted on 20 March 2015 by VRS  |  Email |Print

OPEC has no plans for an extraordinary meeting to discuss ways to shore up oil prices and doesn’t have a choice but to keep its crude production unchanged to maintain market share, Kuwait Oil Minister Ali Al-Omair said.
If other producers want to cut supply, “we will be very happy,” al-Omair said in Kuwait City. No “serious” requests have come from OPEC members to hold early talks so “accordingly the next meeting will be in June,” he said………………………………………..Full Article: Source

Preparing for a Brent Benchmark With No Brent Oil

Posted on 20 March 2015 by VRS  |  Email |Print

It was once a behemoth, a massive North Sea oil field whose importance to the world crude market was summed up by its name atop the global benchmark price: Brent. Today, the Brent field, northeast of Scotland’s remote Shetland Islands, is all but tapped dry. It produces about 1,000 barrels a day in a global market of 93 million daily barrels.
Royal Dutch Shell PLC is awaiting approval to scrap the first of four Eiffel Tower-sized platforms that have sucked Brent-branded crude from the seabed for almost 40 years. In a few years, the Brent benchmark—a crucial metric for global oil prices—will contain no actual Brent at all………………………………………..Full Article: Source

The World’s Biggest Oil And Gas Companies

Posted on 20 March 2015 by VRS  |  Email |Print

Big Oil is in a panic. The global price of crude has fallen further and faster than anyone could have predicted. At $43 a barrel oil is down about 70% from June 2014. Record oil supplies have outstripped demand, and now storage tanks are filling up. By June we might just run out of room to stick all this crude. If that happens $43 a barrel might look great compared with how far oil prices could fall.
It’s remarkable that the world finds itself swimming in Too Much Oil. A decade ago Earth was using about 83 million barrels per day. That’s grown to 93 million bpd now. Remember back in 2008 when the worryworts were prognosticating that record prices of $147 were just the beginning of a Peak Oil super spike? We don’t hear much of them anymore………………………………………..Full Article: Source

India Uses Oil Price Drop To Fill Strategic Reserves

Posted on 20 March 2015 by VRS  |  Email |Print

The world’s fourth biggest oil consumer, India last month built its first underground SPR in Andhra Pradesh. India is set to import 8 million barrels of Iraqi oil to fill its first strategic petroleum reserve (SPR), taking advantage of cheap prices and lending some support to a market suffering from oversupply.
India’s SPR purchases could temporarily help offset the impact of an expected pause in China’s strategic stocks build and the start of spring maintenance at Asian refiners. India’s oil ministry on Tuesday instructed state refiners Indian Oil Corp and Hindustan Petroleum Corp Ltd to each seek two very large crude carriers (VLCC) of Basra oil for arrival in May-June, totalling 8 million barrels, two sources familiar with the matter said………………………………………..Full Article: Source

Growth in non-OPEC oil output to keep crude prices in check

Posted on 20 March 2015 by VRS  |  Email |Print

The unravelling of crude oil prices has been the biggest story of 2014. A combination of factors have led to crude oil prices correcting sharply. While demand-supply mismatches happen to be a big reason for the fall, increase in output from non-OPEC oil producing countries have also played a big role in price movements.
The Organization of Petroleum Exporting Countries in its monthly oil market report dated 16 March has given an indication of demand-supply conditions that are expected to play out in 2015. The cartel of oil producing countries says that it has seen price of the OPEC Reference Basket average at $54.06/barrel in February, representing a gain of 22 per cent, on higher demand and expectations that oil prices have hit a bottom………………………………………..Full Article: Source

Iran on course to regain OPEC position

Posted on 20 March 2015 by VRS  |  Email |Print

Industry observers say Iran is able to reclaim its position as the second largest oil producer in OPEC once US-led sanctions are lifted. Iran has said it could add a million barrels to daily oil production shortly after a deal to lift sanctions.
Minister of Petroleum Bijan Namdar Zangeneh says Iran would bring its oil production to 3.8 million “within a few months” placing it behind only Saudi Arabia in the Organization of Petroleum Exporting Countries. “While such a boost would take months because sanctions may be rolled back slowly, industry observers agree the capacity is there,” Bloomberg admitted………………………………………..Full Article: Source

Everything you want to know about falling oil prices

Posted on 19 March 2015 by VRS  |  Email |Print

Why is the oil price falling? Mostly because of increased supply from America—up by 4m barrels a day since 2009. Although most crude exports are still banned, American imports have plummeted, contributing to a glut on world markets. Other producers have decided not to try to curb their production and keep the price up.
Why? The Organisation of Petroleum Exporting Countries is dominated by Gulf producers, notably Saudi Arabia. They have huge reserves to cushion the impact of low prices. They also hope that the slump will eventually shut down high-cost production, tightening the market again………………………………………..Full Article: Source

Oil prices rebound sharply after Fed move

Posted on 19 March 2015 by VRS  |  Email |Print

Oil prices staged a sharp rebound after the US Federal Reserve scrapped its low-rates guidance on Wednesday, weakening the dollar. US crude had marked a fresh six-year low earlier on Wednesday before the Fed ended a monetary policy committee meeting by dropping a pledge to be “patient” before raising rates, but cutting growth and inflation forecasts.
The new message pushed down the dollar, which tends to move in the opposite direction to commodities that are priced in dollars. Nymex April West Texas Intermediate crude, the US oil yardstick, rose $1.20 to settle at $44.66, erasing losses caused by data showing surging oil inventories inside the US………………………………………..Full Article: Source

Crude Oil Prices Drop Again, but They’re Unlikely to Hit $20

Posted on 19 March 2015 by VRS  |  Email |Print

The most pessimistic prediction has come from Citibank, which has said crude oil could fall as low as $20 a barrel this year, but prospects for $20 oil are as unlikely as the predictions for $60 oil were only a few weeks ago when it looked like an imminent and sustained recovery was just over the horizon. Fundamentally, there is little to stop oil’s slide right now. An interim January low of $43 was broken on Wednesday, and the chart analysts are finding it difficult to predict a bottom.
Oil stockpiles are still increasing, with 458 million barrels in storage, by far a new record. At the rate of increases in stockpiles, it is estimated that storage will be completely used up by the middle of May. With virtually nowhere to put oil, prices will again have nowhere to go but down………………………………………..Full Article: Source

Iran calls for non-OPEC producers to cut oil output: IRNA

Posted on 19 March 2015 by VRS  |  Email |Print

Iran Oil Minister Bijan Zanganeh said non-OPEC producers should cut oil output to prop up prices, adding that he did not see “good cooperation” among producers, the OPEC member country’s official IRNA news agency reported on Wednesday.
“We must also work toward non-OPEC (producers) cutting their production because currently there is not good co-operation,” IRNA quoted Zanganeh as saying………………………………………..Full Article: Source

Will The Oil Markets (And Shale Producers) Capitulate Before Demand Recovers?

Posted on 19 March 2015 by VRS  |  Email |Print

Is the U.S. shale industry at a tipping point? Oil prices fell to a six-week low on Friday after the International Energy Agency warned that the U.S. may soon run out of room to store all the oil being pumped out of shale plays across the country.
As oil starts to back up, the worry is that prices could fall like a rock. But despite this grave warning, bullish oil traders are keeping their cool. They believe that the low prices will ultimately decimate the U.S. shale industry, removing a large chunk of supply from the market indefinitely, similar to what happened during the last major oil price crash 30 years ago………………………………………..Full Article: Source

Oil price slump is choking this OPEC economy

Posted on 19 March 2015 by VRS  |  Email |Print

Plunging oil prices are taking a heavy toll on one of Africa’s top producers. Nigeria’s currency is trading at a record low against the U.S. dollar, the stock market has slumped 15% this year — making it the worst performer in Africa — and financial reserves are being depleted.
“It’s going to be a very difficult year,” Nigeria’s Finance Minister Ngozi Okonjo-Iweala told CNN. “We’ve had a more than 50% fall in the price of oil and that has naturally impacted the economy.” Nigeria is currently pumping about 1.8 million barrels of crude oil per day, making it OPEC’s 7th biggest producer — alongside Angola………………………………………..Full Article: Source

Iran’s Nuclear Deal Could Open Oil Flood

Posted on 18 March 2015 by VRS  |  Email |Print

Iran, the U.S. and its allies are pushing ahead with talks over a nuclear deal that would change many things—perhaps none faster than the price of oil. Iranian exports in recent years have been essentially capped by Western sanctions aimed at pressuring Tehran over its nuclear ambitions.
A deal easing those sanctions could eventually translate into half a million barrels or more a day in Iranian crude heading into a currently glutted global market, analysts estimate. With global crude prices already under pressure, a deal could quickly knock them lower. U.S. oil prices slumped to a six-year low Monday on fresh signs that supplies are swamping the market………………………………………..Full Article: Source

Iran oil supply concerns are ‘unduly bearish’: Analyst

Posted on 18 March 2015 by VRS  |  Email |Print

Concerns that a nuclear deal with Iran could end sanctions on that country and flood an oversupplied market with oil are “unduly bearish,” the managing director at Clearview Energy Partners said. “The deal they have probably won’t bring back crude exports to their full level right away,” Kevin Book said. “It’s probably going to be a series of gates and steps, a process where Iran has to do some things, the West will give some sanctions relief.”
Oil prices began another leg downward last week as participants in negotiations over Iran’s nuclear program suggested they are making progress toward a deal. The April contract for U.S. crude touched a six-year low below $43 on Monday after prices rebounded slightly in January and February………………………………………..Full Article: Source

Oil touches six-year low as Iran talks weigh

Posted on 18 March 2015 by VRS  |  Email |Print

Fears of a supply glut popped a rebound in the price of oil on Tuesday, with comments from Iran about higher production and a possible lifting of sanctions piling on further pressure.
West Texas Intermediate (WTI) futures fell as low as $42.63 a barrel—their weakest level since the March 2009 nadir of $42.51—before paring some losses. Brent crude futures hovered near six-year lows below $53 a barrel, before also paring some losses………………………………………..Full Article: Source

The U.S.’s 12 richest oil and gas CEOs

Posted on 18 March 2015 by VRS  |  Email |Print

Not only does oil and gas provide the life-giving fuel that powers our modern lifestyle, it also has a legacy of often leaving wealth and abundance in its wake. Following the devastating real estate collapse of 2007-2009, it was oil and gas that virtually single-handedly filled Texas and North Dakota’s state surplus budgets to over $2 Billion each within 4 years.
The top-paid CEO in America comes from the natural gas sector. No shock, many of the highly compensated executives the last two years work in the fossil fuel sector; oil and gas in particular. Of curious note however, no CEO from the coal industry appeared on this list, which extends through Robert Walker of Anadarko Petroleum at US$15.7 million, although Consol Energy Inc’s J. Brett Harvey was not far behind at US$15.1 million………………………………………..Full Article: Source

US shale boom may be over by end of 2015 – OPEC

Posted on 18 March 2015 by VRS  |  Email |Print

OPEC is forecasting a possible decrease in US shale oil production by the end of 2015. The number of operating drilling rigs working shale deposits is likely to fall since the price of oil has more than halved since June 2014. The cartel questions the ability of US producers to withstand the dramatic collapse in oil prices and predicts that global oil supply will equal demand, it said in its monthly report published Monday.
“Tight crude producers are aware that typical oil wells in shale plays decline 60 percent annually, and that losses can only be recouped by drilling new wells,” says the report. “As drilling subsides due to high costs and a potentially sustained low oil price, a drop in production [in the US – Ed.] can be expected to follow, possibly by late 2015.”……………………………………….Full Article: Source

The gold:oil ratio is speaking

Posted on 18 March 2015 by VRS  |  Email |Print

As a believer in the power of diversification and inflation protection a basket of commodities can provide in a passive index framework, it is hard to grasp how much investors love oil and gold. It must be that oil is the biggest, most economically significant commodity, and gold is the shiniest, most prized metal – arguably a currency in its own right.
From the largest pensions in the world to the smallest mom-and-pop retail investors, oil and gold dominate the conversation. In Taipei this week, gold and oil were louder than ever. It is an exciting time for greater China as the first commodity futures exchange-traded funds are soon to be launched………………………………………..Full Article: Source

OPEC Warns U.S. Oil Boom Could Be Over by Year-End

Posted on 17 March 2015 by VRS  |  Email |Print

OPEC said Monday the U.S. oil boom could be over by the end of this year, offering a pessimistic view of American producers’ ability to withstand a historic collapse in crude prices and predicting that global petroleum supplies would realign with demand.
The cartel, in its closely watched monthly oil-market report, cited spending cuts by U.S. producers and the falling number of American rigs drilling for oil in recent months after crude prices fell by about 60% from last summer to January before rallying in February. For instance, rig counts fell faster in February than they did in January, according to the latest Baker Hughes report………………………………………..Full Article: Source

China and Middle East will drive oil demand: OPEC

Posted on 17 March 2015 by VRS  |  Email |Print

Almost half of this year’s oil demand growth is likely to come from China and the Middle East, the Organization of the Petroleum Exporting Countries (OPEC) said Monday.
In its monthly report, Opec forecast that global oil demand growth would increase by an average 1.17 million barrels a day to 92.37 million barrels a day, little changed from estimates made in February, as the recent slide in oil prices supports consumption………………………………………..Full Article: Source

Oil plunges to a 6-year low. Is $30 a barrel next?

Posted on 17 March 2015 by VRS  |  Email |Print

Extremely cheap oil is back, and it may get even cheaper. Crude plunged 4% to as low as $42.85 a barrel on Monday. That’s the lowest price since March 2009 and marks the fifth consecutive day of losses. This should bring smiles to the faces of the millions of American drivers who have watched gasoline prices creep higher in recent weeks.
A month ago, people were talking about an “oil comeback.” Now that looks like just a mirage. More and more analysts predict prices of $40 or lower, at least in the near term. “I think the market almost has to have a $30-handle on it before it gets this out of its system,” said Tom Kloza, chief oil analyst at the Oil Price Information Service………………………………………..Full Article: Source

One key reason why oil prices may have further to fall

Posted on 17 March 2015 by VRS  |  Email |Print

Crude prices may be in a holding pattern for the time being, but the conditions under which they appear to have stabilized are anything but reassuring. Despite a saturated world market, North American production, whether it’s bitumen from Alberta’s oil sands or light oil from North Dakota or Texas, continues to increase. So why haven’t prices, in the face of all this supply, continued to fall?
The answer is storage or, more precisely, the record amount of oil that’s being poured into U.S. storage tanks and salt caverns, despite inventory levels that are already at all-time highs. Putting oil into storage is attractive to oil companies right now for two reasons. First, it effectively takes excess oil out of an already glutted market, which alleviates downward pressure on spot prices………………………………………..Full Article: Source

Algeria Seeks Global Oil Producers’ Accord to Halt Price Decline

Posted on 17 March 2015 by VRS  |  Email |Print

Algeria is seeking to coordinate a global response from oil-producing nations to tumbling prices, Algeria Press Service reported, citing Energy Minister Youcef Yousfi. Crude fell to a six-year low in New York on Monday.
“The drastic fall in oil prices has had an extremely negative impact on the economies of all exporting countries, whether OPEC or not members of the Organization of Petroleum Exporting Countries,” Yousfi said after a meeting in Algiers with Angolan Oil Minister Jose Maria Botelho de Vasconcelos. Nigeria’s ambassador to Algiers also attended the discussions………………………………………..Full Article: Source

Non-Opec oil production growth to weaken in 2015

Posted on 17 March 2015 by VRS  |  Email |Print

Slower growth in non-Opec oil production is expected in 2015, but it will take some time yet to assess the full impact of lower prices on North American output, Opec said on Monday. Oil prices have halved since levels reached in mid June last year, triggering a pullback in the number of rigs drilling for oil and a slew of announcements by energy companies about spending cuts.
But the full impact on “US tight [or shale] oil and Canadian oil sands output, will become more evident in the coming months,” the oil producers’ group said in its monthly report………………………………………..Full Article: Source

banner
banner
March 2015
S M T W T F S
« Feb    
1234567
891011121314
15161718192021
22232425262728
293031