Thu, Jun 30, 2016
A A A
Welcome vaishu
RSS

Commodities Briefing - Category | Oil more

Why Oil ETFs Can’t Catch a Break

Posted on 14 June 2016 by VRS  |  Email |Print

Suppose that when West Texas Intermediate crude fell to $26 a barrel on Feb. 11 you had a stroke of genius and figured it couldn’t get much lower. Since you don’t have the billion-dollar backing of a commodities-trading house, you acted in the only way you could and bought into an oil exchange-traded fund.Nice work, you’d think.
Crude is up almost 90 percent since then. Not quite so good for you, though — ETF returns are about half that. Traders generally find life easier when futures curves are in backwardation — with longer-dated contracts cheaper than shorter-term ones — than the reverse situation, known as contango………………………………………..Full Article: Source

Why the Oil Price Rally Might Falter

Posted on 13 June 2016 by VRS  |  Email |Print

Last year’s oil price rally ran out of steam in early May after 112 days. This year’s has already lasted longer (140 days so far) and prices have risen further, but there are worries that, it, too, may be running ahead of market fundamentals. While prices seem unlikely to collapse again, there are good reasons to expect a pause in their upward march.
Crude prices have nearly doubled from the lows reached in mid-January. Brent rose above $50 a barrel last Monday and stayed there all week. West Texas Intermediate crude narrowly failed to do the same after breaking through the psychological barrier on Tuesday………………………………………..Full Article: Source

How OPEC lost its iron grip on oil prices

Posted on 13 June 2016 by VRS  |  Email |Print

When his final press conference as secretary-general of the Organization of the Petroleum Exporting Countries came to an end last week, Abdallah Salem el-Badri finally addressed the whispers that have been circulating throughout the oil markets.
Energy industry observers are howling that “OPEC is dead,” El-Badri acknowledged, after the group again failed to reach an agreement to cap oil production that would bolster sagging prices. His frustration was evident. “I have heard this comment maybe five, six times in my career,” he told reporters in Vienna. “Don’t take that notion that OPEC is dead. OPEC is alive. OPEC will be a very important segment of the economy, of the world.”……………………………………….Full Article: Source

Oil market will find balance amid the turmoil

Posted on 13 June 2016 by VRS  |  Email |Print

There is a lot of disruption going on in oil. We’re talking wildfires and war. The US Energy Information Administration (EIA) calculates that unplanned supply outages, such as those in Canada and Nigeria, reached just over 3.6 million barrels a day last month, the highest since the EIA started tracking them in 2011.
No wonder oil is back above US$50 a barrel. Or, from another perspective, how the hell is oil only at US$50? Oil looks pretty subdued relative to earlier periods of strife, a recent report said. But then, you’d probably be a bit subdued too if you had a few hundred million barrels of oil dumped on top of you………………………………………..Full Article: Source

Will crude oil price ‘reach’ $60/barrel before year-end?

Posted on 13 June 2016 by VRS  |  Email |Print

The surprising news is that oil prices have doubled since the start of this year. It is currently hovering around $55 level and is anticipated to hit the $60 level prior to the end of this year. This news came as a surprise for everyone particularly the oil-producing countries. They did not expect to witness such high increase in oil prices within a short period — from $27 per barrel to $52 in less than six months.
The oil producing nations can soon witness the doubling of their income and can look forward to some positive news. Now that the oil fundamentals are back at work suddenly, crude oil inventories are on the decline as the USA has lost more than 3 million barrels………………………………………..Full Article: Source

Investors Betting on Oil Prices to Hit $100 a Barrel

Posted on 13 June 2016 by VRS  |  Email |Print

The massive plunge in the price of global oil prices has without doubt been one of the biggest triggers for the rising uncertainties in markets worldwide but over the past few months the prices have rallied and some traders and investors believe that the price would rise further in the days to come.
Plenty of traders have taken out contracts that would be triggered only when the price of oil touches $100 or more a barrel and that is without doubt a clear indication that they feel that the pries would continue to rise in the near term………………………………………..Full Article: Source

Oil market getting used to looking up, not down

Posted on 10 June 2016 by VRS  |  Email |Print

Saudi Arabia’s new energy minister Khalid Al Falih is in a quandary. On the one hand, still bloated global oil inventories that drove this year’s prices to lows last seen in 2003 concern him. At the same time, the slashing of hundreds and billions of dollars of investment in future projects by the world’s biggest energy companies might be storing up problems.
After dropping below $30 per barrel in January, the price of Brent crude has risen to more than $50, suggesting that not only has the market bottomed, but a sustained recovery is under way after a protracted fall that started almost two years ago………………………………………..Full Article: Source

Are Low Crude Oil Prices Finally Hurting Saudi Arabia?

Posted on 10 June 2016 by VRS  |  Email |Print

Saudi Arabia held about 267 billion barrels of proven oil reserves at the end of 2014, which is the second largest oil reserves held by a single country. The founder member of the Organization of Petroleum Exporting Countries accounts for roughly 10% of the global oil production and plays a crucial role in the determination of crude oil prices.
The Middle East country also contributes a notable portion of the global oil exports and has a sizeable amount of spare capacity, which it can use to maneuver the dynamics of the oil markets. Thus, the country is being viewed as a game changer in the ongoing oil slump………………………………………..Full Article: Source

Statoil Expects Tighter Oil Market

Posted on 10 June 2016 by VRS  |  Email |Print

Norway’s Statoil ASA said Thursday that it expected the oil market to tighten in the next couple of years, which may cause price spikes, adding that significant investment is needed to offset falling output from existing fields even if oil demand will be lower.
“There is a lot of oil in storage, but within two to three years markets will be tightening significantly,” said Statoil’s chief economist Eirik Waerness. “The question is whether the pace of investment is sufficient to deliver the new [oil] supply that is needed. You can’t rule out that you’ll get a price spike.”……………………………………….Full Article: Source

US Worried OPEC Overproduction Could Lead to ‘Regime Change’ in Venezuela

Posted on 10 June 2016 by VRS  |  Email |Print

The decision by the Organization of Petroleum Exporting Countries (OPEC) to drive production while oil prices fell could ultimately lead to an overthrow of the government of cartel member Venezuela, US Congressman Jeff Duncan told Sputnik on Thursday.
“I think ten years from now, we’ll look back at this as a positive effect, possibly on regime change in Venezuela,” Duncan said of OPEC’s increased supply of oil to the global markets………………………………………..Full Article: Source

Record fall in global coal consumption driven by low oil price

Posted on 09 June 2016 by VRS  |  Email |Print

Global consumption of coal fell by a record amount last year thanks to waning Chinese demand and increasing use of cheaper gas and oil, according to data from BP. The energy giant said that demand for oil, gas and renewable energy all increased last year despite sluggish economic growth but that there was a distinct shift away from coal, the most polluting of energy sources.
Oil increased its market share of global primary energy consumption for the first time since 1999, to 33pc, as low prices spurred demand………………………………………..Full Article: Source

America Sitting on $50 Trillion in Oil and Gas?

Posted on 09 June 2016 by VRS  |  Email |Print

‘Fueling Freedom’ author Kathleen Hartnett White says the U.S. is sitting on $50 trillion in oil and gas, but the government is stopping us from getting at it. Why is the government blocking access to America’s abundant resources and preventing the country from becoming energy independent?
“Yes, it’s quite a big number and it’s the government’s number if you combine all of the Department of Energy’s estimates and I might add it also includes coal,” White said. White said the shale revolution is a key factor in improving access to those energy resources………………………………………..Full Article: Source

Oil market is back in balance: Kemp

Posted on 09 June 2016 by VRS  |  Email |Print

Global oil markets seem to have moved back into balance thanks to strong growth in fuel consumption and a series of large supply disruptions in major crude producing nations. Motorists’ soaring consumption of cheap gasoline in the United States as well as in some large emerging economies, including India and Mexico, will help boost global oil demand by more than 1.4 million barrels per day in 2016.
Consumption had already risen by 1.8 million bpd in 2015 and is predicted to increase by well over 1.0 million bpd again next year, marking the strongest and most sustained increase in demand since before the financial crisis………………………………………..Full Article: Source

Oil Closes Above $50 for Second Day in a Row

Posted on 09 June 2016 by VRS  |  Email |Print

First back-to-back settlements above that mark in nearly a year amid production outages. U.S. oil prices rose to a fresh 10-month high Wednesday as traders stayed focused on production outages that could significantly curb the amount of excess global supply by year’s end.
The benchmark price closed above $50 a barrel for the second session in a row, marking the first back-to-back settlements above that point in nearly a year. Crude oil has nearly doubled in value since hitting decade lows earlier this winter as production disruptions world-wide rein in the oversupply that had spurred two years of falling prices………………………………………..Full Article: Source

Crude prices: Chart says oil could hit $60 — and fast

Posted on 09 June 2016 by VRS  |  Email |Print

Oil’s chart is sizzling, even if its fundamentals are not. West Texas Intermediate crude futures for July were trading above $51 per barrel for the first time since July 2015. Crude was higher on the weaker dollar, continued supply disruptions and as U.S. government data showed a drawdown in the nation’s inventories.
Some of the factors driving the price higher may be fleeting, and oil is widely expected to come off current levels. But strategists say the charts are telling another story………………………………………..Full Article: Source

US forecasts decline in non-OPEC oil supplies

Posted on 09 June 2016 by VRS  |  Email |Print

The US Energy Information Administration (EIA) forecasts non-OPEC countries oil supplies to decline to 57.04 million barrels per day in 2016 and to 56.8 million barrels per day in 2017. Non-OPEC supply of oil and other liquid hydrocarbons was 57.64 million barrels per day in 2015, according to the EIA’s June Short-Term Energy Outlook (STEO).
In its May STEO the EIA forecasted non-OPEC liquid supplies at the level of 56.9 million barrels per day in 2016 and 56.69 million barrels per day - in 2017. The US and Russia are the largest non-OPEC oil producing countries. The US and Russia supplied 15.04 million and 11.03 million barrels of oil and other liquid hydrocarbons per day respectively in 2015, according to EIA………………………………………..Full Article: Source

Nigeria’s Tumbling Oil Production Drags Total OPEC Supply Lower

Posted on 09 June 2016 by VRS  |  Email |Print

Rebel attacks on oil installations cut Nigeria’s production by 10 percent in May, contributing to a drop in monthly output from the Organization of Petroleum Exporting Countries, a Bloomberg News survey showed.
Nigerian production declined by 160,000 barrels a day to 1.45 million, according to the survey. OPEC’s total crude output fell to 32.71 million barrels a day last month, from a revised 32.83 million in April………………………………………..Full Article: Source

EIA raises oil price forecasts for this year and next

Posted on 08 June 2016 by VRS  |  Email |Print

The U.S. Energy Information Administration on Tuesday raised its 2016 and 2017 forecasts for West Texas Intermediate and Brent crude prices. In its monthly energy outlook report, the government agency forecast an average price of $42.83 a barrel for WTI this year, up from a previous estimate of $40.32. Brent crude is seen averaging $43.03 this year, up from the $40.52 May forecast.
The EIA left its U.S. oil production estimates for 2016 and 2017 unchanged at 8.6 million barrels a day and 8.19 million barrels a day, respectively. July WTI crude CLN6, +0.10% was trading at $50.03 a barrel Tuesday, up 34 cents, or 0.7%………………………………………..Full Article: Source

Saudi Arabia sets 2030 oil, gas targets

Posted on 08 June 2016 by VRS  |  Email |Print

Saudi Arabia’s cabinet approved a new economic plan Monday to diversify state revenue in the world’s largest crude oil exporter away from oil by 2030. It also set oil and gas production-capacity targets for the period.
The National Transformation Program elaborates on the Vision 2030 document released in April as the brainchild of Deputy Crown Prince Mohammed bin Salman, the son of the Saudi monarch, Salman bin Abdul Aziz. The deputy crown prince has chaired the Council for Economic and Development Affairs since his father’s accession to the throne………………………………………..Full Article: Source

Oil market is back in balance: Kemp

Posted on 08 June 2016 by VRS  |  Email |Print

Global oil markets seem to have moved back into balance thanks to strong growth in fuel consumption and a series of large supply disruptions in major crude producing nations. Motorists’ soaring consumption of cheap gasoline in the United States as well as in some large emerging economies, including India and Mexico, will help boost global oil demand by more than 1.4 million barrels per day in 2016.
Consumption had already risen by 1.8 million bpd in 2015 and is predicted to increase by well over 1.0 million bpd again next year, marking the strongest and most sustained increase in demand since before the financial crisis………………………………………..Full Article: Source

Oil hits 2016 high on U.S. draw forecasts, Nigeria woes

Posted on 08 June 2016 by VRS  |  Email |Print

Oil prices jumped more than 1 percent on Tuesday, hitting 2016 highs, with U.S. crude settling above $50 a barrel the first time in almost a year, on expectations of domestic stockpile draws and worries about global supply shortfalls from attacks on Nigeria’s oil industry.
U.S. crude stockpiles likely fell by 2.7 million barrels last week to mark a third straight week of declines, an updated Reuters poll showed. A report by trade group American Petroleum Institute (API), released after prices settled, showed a higher-than-expected crude draw of 3.6 million barrels………………………………………..Full Article: Source

Saudi Aramco curbs oil price hikes as it seeks to defend market share

Posted on 07 June 2016 by VRS  |  Email |Print

Saudi Arabia has lifted the price of its crude exports to the US and Asia by less than expected, and deepened cuts for European buyers, in a bid to balance the Kingdom’s need to boost oil revenue while keeping a grip on its dominant market share.
The world’s largest crude exporter more than doubled the price it charges Asian customers on top of the regional oil market price, lifting exports by 35 cents a barrel to 60 cents, in its second consecutive monthly price increase………………………………………..Full Article: Source

This is How Saudi Arabia is Changing OPEC’s Role in Global Oil Market

Posted on 07 June 2016 by VRS  |  Email |Print

Founded back in 1960, the Organization of the Petroleum Exporting Countries (OPEC) now seems to be changing its goals. Its initial goal to regulate oil prices by regulating output does not work anymore. The reason is Saudi Arabia’s policy, which has drawn a lesson from the 1980s oil crisis.
Saudi Oil Minister Khalid al-Falih said that OPEC may change its role in the global crude market and abandon its traditional regulatory mechanism through adjusting output, The New York Times reported. The minister added that the oil exporters should give the market the ability to set fair oil prices while the previous mechanism may never recover………………………………………..Full Article: Source

Shale producers eye comeback with oil @ $50 sweet spot

Posted on 07 June 2016 by VRS  |  Email |Print

Range of $50-$60/b marks sweet spot for global economy – good for consumers, industry, oil producers alike. Global oil prices slipped more than 1 per cent from above $50 to below that psychological mark as US drillers reopened some oil rigs last week – only the second time they’ve done so this year.
According to Baker Hughes data, US added 9 oil rigs last week, taking the number of active oil rigs in the country to 325 from 316 in the previous week. While the number still remains almost half of what it stood a year earlier (642 oil rigs in the US), it does suggest that the current oil prices are encouraging for shale oil producers to remain in business………………………………………..Full Article: Source

Oil Near ‘Sweet Spot’ Puts 70-Year-Old U.S. Index in Focus

Posted on 07 June 2016 by VRS  |  Email |Print

The oil market is turning its attention back to the U.S. as more of its rigs return to work following a surge to $50 a barrel, raising concern that a production rebound may stifle crude’s recovery.
“All eyes” are on the U.S. response to higher prices, Morgan Stanley said in a report Monday, adding that the trend in rig numbers will be closely watched in the coming months. Drillers returned nine machines to operation last week, the biggest gain since December and only the second addition this year, according to Baker Hughes Inc., which has been compiling the data since 1944………………………………………..Full Article: Source

Iran’s Zanganeh says OPEC ‘friends’ dumping crude oil

Posted on 07 June 2016 by VRS  |  Email |Print

Iranian oil minister Bijan Zanganeh accused its regional neighbors of trying to take away its customers by offering cheaper oil, but said despite not offering much of a price discount itself, Iran had managed to retake 1 million b/d.
Iran’s crude is similar to Iraq and Saudi Arabia’s and these producers fight for a share of the same market — being competitive has proved a huge marketing challenge. Zanganeh’s remarks come in an interview with S&P Global Platts in Vienna Friday, the day after OPEC’s meeting in the Austrian capital………………………………………..Full Article: Source

The Oil Rally Could Make You Think Twice About Ordering Dessert

Posted on 06 June 2016 by VRS  |  Email |Print

This year’s rebound for oil prices has an unlikely victim: the dessert plate. To understand why, look no further than Usina Batatais SA, a sugar-cane processor in Sao Paulo. Enticing fuel margins mean the company is using a bigger cane crop to produce more ethanol, while keeping its raw sugar output unchanged.
Even after sugar prices surged recently, “there’s no time and cane anymore” to make a switch, said Bernardo Biagi, Batatais’ president. It’s a story that’s being played out across Brazil, the world’s biggest sugar producer and exporter………………………………………..Full Article: Source

Commodity hedge funds get $5b embrace on oil gain

Posted on 06 June 2016 by VRS  |  Email |Print

The rally in oil has given a fillip to long-suffering commodities hedge funds. After four years of haemorrhaging cash and clients, managers are once again making money and winning back investors. About $5 billion has coursed into the funds in 2016, with the first quarter seeing the biggest inflows since 2009, according to data compiled by eVestment.
Investors are being drawn by gains such as the more than 18 per cent increase reported in a letter to clients by Stuart Zimmer’s ZP Energy Fund in New York and the 12.7 per cent posted by oil trader Pierre Andurand’s $1.1 billion Commodities Master Fund in London. Officials at the funds declined to comment………………………………………..Full Article: Source

Saudi Arabia Cuts Oil Prices in Europe as Iran Ramps Up Exports

Posted on 06 June 2016 by VRS  |  Email |Print

Saudi Arabia on Sunday cut its oil prices to Europe, signaling mounting competition after OPEC failed to cap its output amid Iran’s exports ramp up. In an email sent to customers, state oil company Saudi Aramco said it had cut its light crude prices by 35 cents a barrel to northwest Europe and by 10 cents a barrel to the Mediterranean for July deliveries.
The price reduction is surprising, as demand typically grows in the second half of the year as refineries return from maintenance. In addition, markets have recently been buoyed by outages in countries like Nigeria………………………………………..Full Article: Source

Saudi Arabia And Iran Are Getting Ready For The Next Epic Battle In The Oil Market

Posted on 06 June 2016 by VRS  |  Email |Print

For several months, long time enemies Saudi Arabia and Iran have been caught in an epic battle, and it has been taking oil prices on a roller coaster. Back in December and January, Saudi Arabia let markets perform their magic, drive oil prices to the mid-twenties, undermining Iran’s re-entry to the world oil markets; and shutting down a few dozen American oil rings in the process.
That was the first epic battle. With less oil flowing out of American rigs markets did their magic again, driving oil prices close to $50. Now Saudi Arabia and Iran are gearing up for the next big battle. Saudi Arabia wants OPEC to perform its old magic and drive oil prices higher, to pave the way for the Aramco IPO launch………………………………………..Full Article: Source

OPEC Optimism Masks Iran Risk to Oil Rally From 12-Year Low

Posted on 06 June 2016 by VRS  |  Email |Print

Oil’s recovery from a 12-year low may be too good to last as Iranian output rebounds faster than expected. OPEC last week stuck to its policy of unfettered production, deciding against a new output ceiling as the price rally supported optimism among its members that the oil market is improving.
Bijan Namdar Zanganeh, Iran’s oil minister, said fellow OPEC members didn’t give him any negative signals when they met Thursday in Vienna about his nation’s plan to further raise production. The Persian Gulf nation’s production has surged to the highest since 2011, quicker than the International Energy Agency predicted it could recover to pre-sanctions levels………………………………………..Full Article: Source

Global oil giants seek inroads into India’s retail fuel market

Posted on 06 June 2016 by VRS  |  Email |Print

Global oil majors including Saudi Aramco and Total plan to tap the retail fuel market in India, its oil minister said on Friday, reflecting the expanding role of the world’s fastest-growing large economy on the global crude landscape.
India’s fuel markets could be a lucrative prize for the world’s oil majors as they seek outlets for their gasoline and diesel. India posted the fastest oil demand growth in the world in the first quarter of 2016 and is replacing China as the driver of growth globally, the International Energy Agency said in its latest report………………………………………..Full Article: Source

Saudi Arabia Says Oil at $50 Won’t Hinder Market Recovery

Posted on 03 June 2016 by VRS  |  Email |Print

Oil prices at $50 won’t allow shale oil and other higher-cost producers to lift supply to levels that hinder market recovery, Saudi Arabia’s oil minister said. Prices need to be at level above $50 a barrel for more crude supplies to come back to the market following a slump over the past two years, Khalid Al-Falih, Minister of Energy, Industry and Mineral Resources, said.
“I talk to a lot of industry executives and board members. I don’t think you are going to see a rush back into investments at $50,” he said………………………………………..Full Article: Source

Anatole Kaletsky: US$60 is the oil price for foreseeable future

Posted on 03 June 2016 by VRS  |  Email |Print

For the first time since last October, the oil price has nudged or broken the $US50 a barrel barrier. Back then, I argued that $US50 or thereabouts would turn out to be a long-term ceiling for the oil price. At the time, with crude prices still above $US60, almost everyone believed that $US50 would be the rock-bottom floor.
After all, futures markets predicted prices of $US75 or higher; the Saudi and Russian governments needed $US100 to balance their budgets; and any price much below $US50 was considered unsustainable, because it would put the US shale-oil industry out of business………………………………………..Full Article: Source

OPEC Skips Output Limit, Finds Unity in Oil Price Optimism

Posted on 03 June 2016 by VRS  |  Email |Print

OPEC will stick to its policy of unfettered production after members rejected a proposal to adopt a new output ceiling, but ministers were united in their optimism that global oil markets are improving.
While crude prices dipped briefly after Thursday’s meeting, there was little of the rancor that punctuated last December’s gathering. The more harmonious atmosphere meant the group was able to appoint a new secretary-general — Nigeria’s Mohammed Barkindo — something it hadn’t been able to agree on since 2012………………………………………..Full Article: Source

Oil production stays level as Opec summit produces no deal

Posted on 03 June 2016 by VRS  |  Email |Print

The failure of the once mighty oil cartel Opec to reach a production-curbing deal was hardly a big surprise. Saudi Arabia wanted to limit output in order to underpin crude on global markets, but for both financial and political reasons there was never the remotest possibility that Iran would agree.
No longer a pariah after the lifting of western sanctions, Iran is keen to ramp up its production. Clearly, it would prefer oil to be changing hands at $60 a barrel rather than $30 a barrel, but $30 a barrel is a lot better than $0 a barrel. Both Saudi Arabia and Iran want to be regional top dog in the Middle East. There is no love lost between Tehran and Riyadh………………………………………..Full Article: Source

Opec resists output cap with oil near $50

Posted on 03 June 2016 by VRS  |  Email |Print

Saudi oil minister says it is ‘premature’ to restrict production, as demanded by some exporters. Saudi Arabia’s new energy minister rallied Opec support for maintaining production on Thursday, as a near-doubling of crude prices since January eased tensions among oil exporters.
Khalid Al Falih said that the 13-member group should “encourage the rebalancing” of the market as prices recover from the worst crash in more than a decade. But he told reporters at the Opec meeting in Vienna that it was “premature” to try and restrict output, as demanded by some of the hardest hit exporters, when production growth was already declining and demand was responding to lower prices………………………………………..Full Article: Source

OPEC is finished: Oppenheimer’s Fadel Gheit

Posted on 03 June 2016 by VRS  |  Email |Print

OPEC is a dysfunctional organization that has outlived its usefulness, Oppenheimer senior energy analyst Fadel Gheit said. “OPEC is finished. OPEC is over,” he said. “Shale production has completely changed the way we look at energy and it’s not going to change. The fact of the matter is that OPEC and Saudi Arabia are no longer the swing producers they were only two years ago.”
In its meeting Thursday in Vienna, the Organization of the Petroleum Exporting Countries failed to agree on a new production ceiling and therefore did not change its oil output policy. The cartel has been pumping oil at record levels despite the drop in global crude prices that began in 2014………………………………………..Full Article: Source

OPEC Is Dead, Long Live OPEC!

Posted on 02 June 2016 by VRS  |  Email |Print

Reports of OPEC’s death have been greatly exaggerated, as many observers mistake inaction for impotence. Throughout the history of the organization, it has been strong, weak, active and passive, but arguably the third-most successful cartel in the past century. (Diamonds are first, the Seven Sisters under the Achnacarry the second.)
Since the rise of OPEC power in the early 1970s, the oil price has remained above the long-term historical level, something all but unheard of for commodities. (Well, sugar in the U.S., where a handful of producers have the political clout to maintain import quotas. Maybe peanuts and tobacco, and well, you get the idea.)……………………………………….Full Article: Source

Be careful wishing for a higher oil price

Posted on 02 June 2016 by VRS  |  Email |Print

Financial markets are happier with oil at $50, but further advances will pose problems. Financial markets have been breathing more easily since late January, when the oil price began a rebound that last week took it beyond the $50 a barrel mark for the first time since November.
Financial conditions in the US are looser, emerging markets are perkier and US energy stocks have staged a recovery so sharp they are now the S&P 500’s third-best performing sector this year………………………………………..Full Article: Source

OPEC swagger fades as oil struggles at $50 ahead of cartel’s summit

Posted on 02 June 2016 by VRS  |  Email |Print

A year and a half after the Organization of the Petroleum Exporting Countries’ decision not to cut production levels despite a global glut of crude, oil prices have finally managed to climb back above $50—they just haven’t been able to stay there.
That is raising questions over OPEC’s power to control the oil market ahead of its regularly scheduled meeting this Thursday in Vienna. West Texas Intermediate and Brent crude have rallied roughly 67% from their lows this year but as of Tuesday, failed so far this year to settle above $50 a barrel………………………………………..Full Article: Source

OPEC states that wanted production cuts buckle under the new oil order

Posted on 02 June 2016 by VRS  |  Email |Print

Saudi Arabia engineered OPEC’s policy to kill off U.S. shale oil production. The plan was straightforward: Keep pumping oil, maintain market share and outlast the Americans. But the plan is also producing casualties within the cartel itself: Angola, Nigeria and a Venezuela that’s on the verge of implosion.
Six months after OPEC left its high-production policy in place, some of the cartel members who called loudest for output cuts are feeling the most pain. Inflation is soaring and currencies have plummeted in lesser petro states, as top exporter Saudi Arabia continues to dictate policy………………………………………..Full Article: Source

Saudi, Iran set to clash over OPEC oil output targets

Posted on 02 June 2016 by VRS  |  Email |Print

OPEC is set for another showdown between rivals Saudi Arabia and Iran when it meets on Thursday, with Riyadh trying to revive coordinated action and set a formal oil output target but Tehran rejecting the idea.
Tensions between the Sunni-led kingdom and the Shia Islamic Republic have been the highlights of several previous OPEC meetings, including in December 2015 when the group failed to agree on a formal output target for the first time in years………………………………………..Full Article: Source

Iran’s oil already factored in, minister says

Posted on 02 June 2016 by VRS  |  Email |Print

The global market for crude oil is moving closer toward balance, suggesting Iran’s return had already been factored in, the country’s oil minister said. Total crude oil production from members of the Organization of Petroleum Exporting Countries for April, the last full month for which data are available, was 32.4 million barrels per day, about 180,000 bpd higher than for March. Increased production from member states Iraq and Iran offset declines in Kuwait and Nigeria.
According to OPEC’s latest figures, Iranian crude oil production for April of 3.4 million bpd was 20 percent higher than the average for the fourth quarter of 2015. Iranian Oil Minister Bijan Zangeneh said exports, meanwhile, have doubled, but that increase in supply has not pushed crude oil prices lower………………………………………..Full Article: Source

Commodity Hedge Funds Get $5 Billion Embrace on Oil Gain

Posted on 01 June 2016 by VRS  |  Email |Print

The rally in oil has given a fillip to long-suffering commodities hedge funds. After four years of hemorrhaging cash and clients, managers are once again making money and winning back investors.
About $5 billion has coursed into the funds in 2016, with the first quarter seeing the biggest inflows since 2009, according to data compiled by eVestment. Investors are being drawn by gains such as the more than 18 percent increase reported in a letter to clients by Stuart Zimmer’s ZP Energy Fund in New York and the 12.7 percent posted by oil trader Pierre Andurand’s $1.1 billion Commodities Master Fund in London……………………………………….Full Article: Source

Why $US50 is the new normal price ceiling for global oil prices

Posted on 01 June 2016 by VRS  |  Email |Print

For the first time since last October, the price of a barrel of oil has broken through $US50. So it seems a good time to update the analysis I presented in January 2015. Back then, I argued that $50 or thereabouts would turn out to be a long-term ceiling for the oil price. At the time, with crude prices still above $US60, almost everyone believed that $US50 would be the rock-bottom floor.
After all, futures markets predicted prices of $US75 or higher; the Saudi and Russian governments needed $US100 to balance their budgets; and any price much below $US50 was considered unsustainable, because it would put the US shale-oil industry out of business………………………………………..Full Article: Source

Oil Price Forecasts Get More Bullish as Oversupply Concerns Ease

Posted on 01 June 2016 by VRS  |  Email |Print

Analysts are again raising their oil-price forecasts, in a reflection of falling concerns over the glut in crude supply. That helps relieve the pressure on members of the Organization of the Petroleum Exporting Countries—who are set to meet on Thursday—following months of fervent debate over production levels within the cartel.
Investment banks surveyed by The Wall Street Journal raised their price forecast for the third consecutive month in May, predicting that Brent crude, the international benchmark, would average $43 a barrel in 2016. That is up $2 from April’s survey………………………………………..Full Article: Source

UAE minister says happy with oil market

Posted on 01 June 2016 by VRS  |  Email |Print

UAE Oil Minister Suhail bin Mohammed al-Mazroui said on Tuesday he was happy with the oil market, noting that prices had been correcting higher. “We are optimistic. We are seeing that the market is correcting upward,” Mazroui told reporters in Vienna.
Oil ministers from the Organization of the Petroleum Exporting Countries meet on Thursday in the Austrian capital. Oil prices rose on Tuesday, heading for the fourth straight monthly gain, with investors betting on higher U.S. fuel demand as peak driving season arrived in the No. 1 oil consumer………………………………………..Full Article: Source

New Saudi energy minister shows he takes Opec seriously

Posted on 01 June 2016 by VRS  |  Email |Print

For Opec watchers, every little detail matters. When the oil producer group holds its half-yearly meetings, what time the ministers arrive in Vienna, how they speak and which hotel they stay in - anything will be analysed in an attempt to predict its policies.
So it was seen as a sign that new Saudi Energy Minister Khalid al-Falih takes Opec seriously when he turned up in the Austrian capital on Monday, three days before the Organization of the Petroleum Exporting Countries’ upcoming discussions………………………………………..Full Article: Source

Forget gold, oil is the star investment right now!

Posted on 01 June 2016 by VRS  |  Email |Print

Since the turn of the year, the price of gold has risen by around 18%. As a result, many investors are highly optimistic about the prospects for the precious metal and it has clearly been a strong performer in 2016.
A key reason for this is the fact that US interest rates have risen at a much slower pace than expected. When the Federal Reserve increased interest rates in December, it was expected that there would be as many as four rate rises this year, but with none by May, this figure is unlikely to be met. As such, interest-producing assets have been less enticing than was anticipated and the price of gold has risen………………………………………..Full Article: Source

banner
June 2016
S M T W T F S
« May    
 1234
567891011
12131415161718
19202122232425
2627282930