# Crude oil market



## waltky

IF oil prices go up - blame Turkey...

*U.S. oil eases on profit-taking after rally on Mideast risks*
_Tue Nov 24, 2015 - U.S. crude oil futures dipped on Wednesday on profit-taking after the prices rallied to a two-week high on the previous session due to heightening geopolitical tensions in the Middle East with Turkey's downing of a Russian warplane._


> U.S. crude's West Texas Intermediate (WTI) futures CLc1 shed 16 cents or 0.37 percent at $42.71 a barrel as of 0054GMT. It finished the previous session up $1.12, or 2.7 percent, at $42.87 after hitting $43.46 earlier, its highest since Nov. 11.  Brent LCOc1 settled up $1.29, or 2.9 percent, at $46.12 a barrel, after hitting a two-week high at $46.50.
> 
> Turkey shot down a Russian warplane near the Syrian border on Tuesday, saying the jet had violated its air space. Russian President Vladimir Putin said the plane warned of "serious consequences" for what he termed a stab in the back administered by "the accomplices of terrorists".  U.S. President Barack Obama and French President Francois Hollande pressed Russia on Tuesday to focus its attacks in Syria on Islamic State (IS) militants.  The United States and France separately agreed on Tuesday to ramp up military operations against IS in Syria and Iraq and coordinate intelligence on domestic threats following the worst attacks to hit France since World War Two.
> 
> Regarding the U.S. crude oil inventories, industry group the American Petroleum Institute data showed on Tuesday that the inventories rose by 2.6 million barrels in the week to Nov. 20 to 488.3 million, compared with analysts' expectations for an increase of 1.2 million barrels. [API/S] [EIA/S]  Asian stocks were mixed in early trading on Wednesday. The U.S. dollar was lower, hurt in part as the latest flare up in geopolitical tensions generated demand for safe haven Treasuries and drove their yields lower. The dollar index .DXY retreated from an 8-month peak of 100.000 set on Monday. [MKTS/GLOB]
> 
> U.S. oil eases on profit-taking after rally on Mideast risks


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## JakeStarkey

Another $ or 3 at the most.

Then back down to 41.


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## Mr. H.

The wife and I have discussed selling the house, taking the equity, and moving into an apartment. After the dog dies LOL. 
Yeah, it's down to that. I give it 18-24 months before crude markets make an appreciable move upwards. 

The bullshit RFS should be repealed. Those ass fucking farmers have been cutting into our market for far too long.


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## waltky

Means gas prices likely to stay down for the near future...

*OPEC to keep oil output at high level*
_Saturday, December 5, 2015 - OPEC members decided Friday to keep producing oil at their current high levels, effectively acknowledging their inability to push up crude prices._


> An attempt to nudge the cost of oil higher would have involved lowering output. Instead, the organization's endorsement of present output, which is more than 1.5 million barrels a day above the formal ceiling of 30 million barrels, is likely to push the price of oil down further.  The ministers of the Organization of the Petroleum Exporting Countries appeared to have little choice. Major producing nations in the cartel were opposed to reducing output. Instead, OPEC is poised to produce more oil.
> 
> Iran, which once pumped around 4 million barrels a day and is now down to about half that, is preparing to come back fully on line once it sheds nuclear-related sanctions in a few months.  Senior oil official Amir Hossein Zamaninia said last week Iran hopes to bring an extra 500,000 barrels on the market by early next year. He said he hopes the extra output will be accommodated within OPEC's formal ceiling of 30 million barrels a day.
> 
> Arriving for Friday's meeting, Iranian oil minister Bijan Namdar Zanganeh said Iran is ready to discuss a ceiling for its production - but only after his country makes a "full return to the market."  Iraq is also resurgent. The country has seen the fastest rise in crude production in the world this year. It was pumping more than 4 million barrels a day last month and was responsible for last month's biggest monthly rise in output among all OPEC countries.
> 
> And the ministers agreed to readmit Indonesia, to expand their ranks to 13. While that country's production goes mostly for domestic consumption, that move could also add some to the total amount of OPEC barrels on sale.  Friday's news pushed oil prices down, with the U.S. benchmark rate sliding 2.7 percent on the day to $39.99.
> 
> OPEC to keep oil output at high level


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## waltky

Oil prices still on the down side...

*Oil falls towards 2015 low on OPEC inaction, strong dollar*
_Mon Dec 7, 2015 - Oil prices edged closer to 2015 lows on Monday after OPEC failed to agree on a production curb to stem sliding prices and a stronger dollar made it more expensive to hold crude positions.  The Organization of the Petroleum Exporting Countries (OPEC) ended its policy meeting on Friday without agreeing to lower production._


> For the first time in decades, oil ministers dropped any reference to the group's output ceiling, highlighting disagreement among members about how to accommodate Iranian barrels once Western sanctions are lifted.  "A stronger dollar and the aftershock of Friday's OPEC meeting are weighing on the oil market," said Tamas Varga, oil analyst at brokerage PVM Oil Associates in London.  Brent crude prices LCOc1, the globally traded benchmark, were down 38 cents at $42.62 a barrel at 0929 GMT, close to their 2015 low of $42.23. U.S. crude CLc1 was trading at $39.42 a barrel, down 55 cents.  The dollar .DXY was up against a basket of currencies.
> 
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> An oil pump jack can be seen in Cisco, Texas​
> Analysts at Barclays said the lack of an OPEC production target in its written announcement was a sign of discord.  "Past communiques have at least included statements to adhere, strictly adhere, or maintain output in line with the production target. This one glaringly did not," they said.  OPEC's output of more than 30 million barrels per day (bpd) has compounded an oil glut, pushing production 0.5 million to 2 million bpd beyond demand and putting many producers under pressure, especially small-sized U.S. shale drillers that have piled up large amounts of debt.  Saudi Arabia, the world's biggest oil exporter, is banking on producers of unconventional oil to buckle for output to fall.
> 
> Amin Nasser, Chief Executive Officer of Saudi Aramco, said at a conference in Doha on Monday he hoped to see oil prices adjust at the beginning of next year as unconventional oil supplies start to decline.  Others disagreed. Patrick Pouyanne, Chief Executive Officer of French oil company Total, said at the same event that he did not expect prices to recover next year as production growth was set to outstrip a rise in demand.  "It is not unreasonable to assume that downward pressure on prices will remain for the foreseeable future, as it will take time for low prices to materially scale back production," said analysts at Cenkos Securities.  In a sign investors expect prices to remain weak over years to come, WTI forward contracts out to 2024 have dropped below $60 a barrel.
> 
> Oil falls towards 2015 low on OPEC inaction, strong dollar


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## waltky

Uncle Ferd likes these lower gas prices...

*Crude oil holds at seven-year lows as global glut persists*
_Fri Dec 11, 2015 - Crude oil prices remained at levels not seen since early 2009 on Friday as output in the Middle East continued to rise despite an already huge global glut, with analysts saying the price outlook for the rest of the year and into 2016 remained weak._


> Brent crude futures were down 9 cents at $39.64 a barrel at 0745 GMT, not far off almost seven-year lows hit earlier in the session at $39.38 a barrel.  U.S. crude futures were at $36.65 per barrel, down 11 cents and still close to Thursday's bottom of $36.38 - the benchmark's lowest mark since February 2009.  "The next quarter is going to be particularly tough as we go from a high-demand to a low-demand quarter," said Richard Gorry, director of consultancy JBC Energy Asia.  "Can you rule out $20 per barrel? No, you can't," he said, although adding that prices would not likely fall that far.
> 
> Gorry said he expected a slow rebalancing of the market towards the end of next year, with production remaining stubbornly high despite low benchmark prices.  "A lot of producers are trying to maintain positive cash-flows and that means maximising output, and Iranian barrels are also coming back to the market," he said.  The price rout is a result of a huge overhang in production that is fast filling onshore storage sites, which some analysts expect to run out in early 2016.  "The market is strongly positioned for further price declines which is proven by the large number of short contracts in the market," ABN Amro said on Friday.
> 
> Jefferies bank said that an "inventory overhang is likely to expand significantly through the first half of 2016 and will likely suppress oil prices in the near-term."  Soaring output from OPEC member Iraq has been a large contributor to that overhang, with production there doubling over the past decade to around 4.3 million barrels per day, more than enough to meet all of India's daily demand.  OPEC as a whole pumped more oil in November than in any month since 2008, totalling 31.7 million barrels per day despite forecasting little demand growth for crude next year in a bid to defend market share.
> 
> The cartel's strategy to safeguard market share by pumping at record levels might be working.  U.S. shale oil production, the main driver of non-OPEC supply growth, is expected to fall for a ninth consecutive month in January, according to a forecast on Monday from the U.S. Energy Information Administration.
> 
> Crude oil holds at seven-year lows as global glut persists



See also:

*Islamic State oil is going to Assad, some to Turkey, U.S. official says*
_Thu Dec 10, 2015 - Islamic State militants have made more than $500 million trading oil with significant volumes sold to the government of Syrian President Bashar al-Assad and some finding its way to Turkey, a senior U.S. Treasury official said on Thursday._


> The United States, France, Britain and Russia have vowed to defeat Islamic State, which uses an extreme interpretation of Islam to justify attacks and brutality in large parts of Syria and Iraq that it controls.  A U.S.-led coalition is bombing the hardline Sunni group, as is Assad's only big-power supporter Russia, in an attempt to kill its leaders and cripple the oil wells which the group uses to finance its rule and attacks abroad.
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> An undated still image taken from a video made available by the Russian Defence Ministry in Moscow, Russia December 2, 2015, shows the Turkish-Syrian border crossing. Russia's defence ministry officials displayed satellite images on Wednesday which they said showed columns...​
> In one of the most detailed public explanations of Islamic State's oil trade, U.S. Treasury Department official Adam Szubin said militants were selling as much as $40 million a month of oil at the installations which was then spirited on trucks across the battlelines of the Syrian civil war and sometimes further.  "ISIL is selling a great deal of oil to the Assad regime," Szubin, acting under secretary for Terrorism and Financial Intelligence with the Treasury, told an audience at Chatham House in London.  "The two are trying to slaughter each other and they are still engaged in millions and millions of dollars of trade," Szubin said of Assad's government and Islamic State, also known as ISIS or ISIL.
> 
> The "far greater amount" of Islamic State oil ends up under Assad's control while some is consumed internally in Islamic State-controlled areas. Some ends up in Kurdish regions and some in Turkey, he said.  "Some is coming across the border into Turkey," Szubin said when asked for details on the money trail.  "Our sense is that ISIL is taking its profits basically at the wellhead and so while you do have ISIL oil ending up in a variety of different places that's not really the pressure we want when it comes to stemming the flow of funding - it really comes down to taking down their infrastructure," he said.  Szubin said it was unclear whether the $40 million a month estimate could be multiplied over a year. But in remarks prepared for delivery, he said Islamic State had made more than $500 million from the oil trade, but did not give a more specific time period.
> 
> 'SECURE THE TURKISH BORDER'


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## Billyjack

The the CME states that they trade 750,000 options and contracts daily. A contract is 1000 barrels. The liquid oil is around 95,000,000 barrels per day. Therefore 750,000,000 paper barrels are traded daily versus 95,000,000 liquid barrels. I suggest that rather than checking with OPEC or Exxon you check with Goldman Sachs concerning oil prices.


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## JakeStarkey

Billyjack said:


> The the CME states that they trade 750,000 options and contracts daily. A contract is 1000 barrels. The liquid oil is around 95,000,000 barrels per day. Therefore 750,000,000 paper barrels are traded daily versus 95,000,000 liquid barrels. I suggest that rather than checking with OPEC or Exxon you check with Goldman Sachs concerning oil prices.


That is interesting but so what.  Explain some more, please.


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## Billyjack

Oil prices have always been manipulated. From Drake(1859) to Opec(1971) oil prices were kept artificailly low by the major refiners becuase their refinery margins are better at low crude oil prices than high. For the record Exxon is a net crude oil buyer not a seller, they only make money by selling gasoline. In 1971, we had the first Arab oil embargo and then the price was made artificially high when OPEC was able to restrict production and create an under supply situation. Then oil began trading as a commodity in 1981, yet the supply was still short. The first time in history that the market actually reflected the true price of oil was 1986 when prices dropped from around $40/bbl to less than $8/bbl. At that time supply was close to 75 mmbopd versus demand of around 55 mmbopd.  Prices stayed low until the 1990's as consumption increased 2 mmbopd/year while the production side was in a depression and created no new supply. Just a little history, sorry. 
Goldman and 3 or 4 hedge funds control about 60% of the market trades on the CME. They were caught a few years back making 100,000,000 barrel 24 hour round trip trades to insure their position. In an over supply situation the speculators will control prices not OPEC.


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## JakeStarkey

Billyjack said:


> Oil prices have always been manipulated. From Drake(1859) to Opec(1971) oil prices were kept artificailly low by the major refiners becuase their refinery margins are better at low crude oil prices than high. For the record Exxon is a net crude oil buyer not a seller, they only make money by selling gasoline. In 1971, we had the first Arab oil embargo and then the price was made artificially high when OPEC was able to restrict production and create an under supply situation. Then oil began trading as a commodity in 1981, yet the supply was still short. The first time in history that the market actually reflected the true price of oil was 1986 when prices dropped from around $40/bbl to less than $8/bbl. At that time supply was close to 75 mmbopd versus demand of around 55 mmbopd.  Prices stayed low until the 1990's as consumption increased 2 mmbopd/year while the production side was in a depression and created no new supply. Just a little history, sorry.
> Goldman and 3 or 4 hedge funds control about 60% of the market trades on the CME. They were caught a few years back making 100,000,000 barrel 24 hour round trip trades to insure their position. In an over supply situation the speculators will control prices not OPEC.


Gotcha.  I don't agree with all of that, but it is very interesting.  Thank you.


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## waltky

Oil prices drop again...

*Oil prices drop for seventh session on oversupply worries*
_Sun Dec 13, 2015 - Crude oil futures fell for a seventh straight session on Monday, their longest losing streak since mid-2014, as a forecast from the International Energy Agency (IEA) that the global supply glut was likely to deepen next year dragged on prices._


> Brent crude LCOc1 fell below $38 a barrel for the first time since December 2008 on Friday after the IEA said demand growth was slowing while OPEC output remained high. U.S. crude, West Texas Intermediate (WTI) CLc1, settled in the $35 territory for the first time since February 2009.  Front month WTI was down 16 cents at $35.46 a barrel by 0410 GMT, while Brent was down 23 cents to $37.70 a barrel.
> 
> Both benchmarks have fallen every day since the Organization of the Petroleum Exporting Countries (OPEC) on Dec. 4 abandoned its output ceiling. In the past six sessions, they have shed more than 13 percent each.  OPEC has been pumping near record levels since last year in an attempt to drive higher-cost producers such as U.S. shale firms out of the market.
> 
> New supply is likely to hit the market early next year as OPEC member Iran ramps up production once sanctions are lifted as expected following the July agreement on its disputed nuclear program, BMI Research said in a note.  "All new production will be earmarked for exports," BMI Research said. "In addition to volumes released from storage, Iran will be able to increase crude oil and condensates exports by a maximum of 700,000 b/d by end-2016," it said.
> 
> Oil prices drop for seventh session on oversupply worries


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## JakeStarkey

Futures this morning for WTI and Brent at 35.27 and 37.29, a decrease of about 1%.

It's going to get much worse.


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## waltky

Oil prices startin' to inch back up...

*U.S. oil rises, reversing course after nearing 11-year lows*
_14 Dec.`15  - U.S. crude rose nearly 2 percent Monday, recovering slightly after moving within a hair of 11-year lows, but analysts and traders said it is still too early to declare the market has reached its bottom._


> Both U.S. and global benchmark Brent crude have been tumbling downward since an OPEC meeting Dec. 4 at which the oil-producing countries removed their production ceiling, exacerbating global crude oversupply. Monday's close marked the first significant rebound since the meeting.  Early in the day, both Brent and U.S. crude futures fell by as much as 4 percent to their lowest levels since the start of the 2008 financial crisis, before turning around midday in the United States.  Brent futures for January delivery settled down 1 cent at $37.92 a barrel. U.S. crude rose 69 cents, or 1.94 percent, to $36.31.  The two benchmarks began to converge - a step toward eliminating the once-deep discount for U.S. crude - in an indication that the market is shifting structurally.
> 
> Early in the session, Brent traded just 13 cents above the $36.20 low set in December 2008. Below that level, it would be at its lowest since July 2004, when oil was rebounding from single-digits lows hit during the 1998 financial crisis and when talk of a commodities super-cycle was just beginning.  But the rebound from these near record lows may be short-lived.  "Crude cannot sustain any kind of significant rally until we see the fundamentals begin to shift," said Matthew Perry, partner with Kronenberg Capital Advisors. Crude may fall further before the macro-economic changes needed for a recovery occur, he said.  "Rebounds off $35 overnight aren't necessarily bullish or a structural change," said Phil Thompson, vice president of market analytics at Mobius Risk Group in Houston. Because the market remains dominated by traders with short positions, the rebound does not necessarily indicate a macro-reversal, he said. "The market's really sore. It's very, very oversold."
> 
> Data from the U.S. Commodity Futures Trading Commission (CFTC) on Friday showed money managers, including hedge funds and other big speculators, cut their net longs in U.S. crude oil futures by 12,117 contracts during the week to Dec. 8.  This marked a fifth straight week of declines that left their net long position in U.S. crude at 46,919 contracts, the lowest since the CFTC created the managed money category for oil in 2009. [CFTC/]  "The hedge fund community is extraordinarily short right now," said Perry. "The fundamentals have not changed for crude oil. We are still expecting an overabundance of supply going into 2016."  Crude markets that have been oversupplied due to the U.S. shale boom have seen supply woes compounded by OPEC's latest decision and, more recently, by a Libyan ceasefire agreement Sunday that could bring shuttered crude from that country back online.
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> MORE


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## JakeStarkey

Gartmann today on CNBC said that the Japanese, other Asian, European, and the USA stock markets have all broken the plane of the last few years' growth.  He was not willing to say the bull session was over but that he would be very, very neutral on buying or selling.  I think crude oil will drop to $30 by the first of January.


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## SAYIT

Billyjack said:


> Oil prices have always been manipulated. From Drake(1859) to Opec(1971) oil prices were kept artificailly low by the major refiners becuase their refinery margins are better at low crude oil prices than high...



Those who pump the oil out of the ground find their margins to be higher when the price of crude is higher and, depending on demand, they determine the price by how much oil they pump into the market.

OPEC's inability to limit global supply has driven the price down, not any effort to keep oil prices "artificially low."



waltky said:


> Oil prices startin' to inch back up...
> *U.S. oil rises, reversing course after nearing 11-year lows*



Bouncing while searching for the bottom. 
Nothing about the supply & demand imbalance has changed since yesterday.


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## waltky

A rise in rates is typically negative for oil prices...

*Crude prices dip after recent gains as Fed decision looms*
_Tue Dec 15, 2015 - Crude oil fell in Asian trade on Wednesday, snapping gains that pulled prices back from testing 11-year lows, as investors awaited the outcome of a Federal Reserve meeting, where interest rates are likely to be raised._


> West Texas Intermediate CLc1 fell 55 cents to $36.91 a barrel by 0219 GMT after rising more than $1 on Tuesday. It fell to $34.53 on Monday, the lowest since it financial crisis bottom of $32.40, before ending the day higher.  Brent LCOc1 was down 33 cents at $38.12. The contract settled up 53 cents at $38.45 a barrel on Tuesday, closing higher for the first in eight days.
> 
> On Monday, the global oil benchmark came within 14 cents of a December 2008 bottom of $36.20, unleashing a surge of buying support.  "The drop in prices is not surprising after the rally the previous session as the market girds itself for the decision on rates and official figures on inventory levels in the U.S., said Michael McCarthy, chief market strategist at CMC Markets in Sydney.  "There haven't been any great shifts in the fundamentals and clearly ahead of, not only the Fed rate decision, but the inventory read that we will receive, it wouldn't surprise me if we maintain a holding pattern until then," he said.  The Federal Reserve on Tuesday started a two-day meeting where it is expected to raise rates eight years after a devastating recession opened an era of loose U.S. monetary policy.
> 
> A rise in rates is typically negative for oil prices because a hike is likely to prop up the greenback, making crude contracts more expensive as they are denominated in dollars.  Markets are already prepared for a 25 basis point increase but will be closely watching the Fed's policy statement for indications of where rates will go next year.  In a further sign of oversupply in the market, data released late on Tuesday by the industry group, American Petroleum Institute, showed a surprise build of 2.3 million barrels in U.S. crude stockpiles last week.  A Reuters poll of analysts had forecast a 1.4 million-barrel draw instead. Official inventory data is due on Wednesday from the U.S. Energy Information Administration.
> 
> Crude prices dip after recent gains as Fed decision looms



See also:

*Asia surges as Wall Street gains lifts sentiment before Fed decision*
_ Wed Dec 16, 2015  Asian stocks rose briskly on Wednesday, with sentiment lifting as Wall Street rose before a likely hike in U.S. interest rates, while the dollar held to large gains made as Treasury yields picked up._


> Spreadbetters saw the upbeat momentum in equities being retained in Europe and forecast a higher open for Britain's FTSE .FTSE, Germany's DAX .GDAXI and France's CAC .FCHI.  The Federal Reserve is expected to announce a hike in interest rates when its two-day policy setting meeting ends later in the day. It would be the first U.S. rate hike in nearly a decade, signaling the beginning of an end to an expansionary monetary policy that has supplied a tidal wave of liquidity to risk asset markets globally.  MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS rose 2 percent. Shanghai stocks .SSEC edged up 0.8 percent and Australian shares rallied 2.2 percent. Crude oil prices bouncing from multi-year lows buoyed energy-related shares.
> 
> Japan's Nikkei .N225 surged 2.5 percent, rebounding from a two-month low struck the previous day as risk sentiment has blown hot and cold ahead of one of the most-anticipated market events this year.  "A lot of capital will be looking for a temporary home outside of the U.S. so as to avoid the likely increase in volatility after the hammer falls. And in the context of our current world markets, for many Japan looks like a credible home," said Martin King, co-managing director at Tyton Capital Advisors.  On Wall Street Tuesday, the Dow .DJI added 0.9 percent and the S&P 500 .SPX advanced 1.1 percent. Bank stocks, which will likely benefit from higher rates, were among the market leaders.
> 
> With a hike seen as a mostly done deal after more than a year of anticipation, investor focus is fixed on how the Fed might opt to pace its tightening cycle next year. The central bank has hinted that it intends to hike rates gradually.  "(Fed chair) Yellen should stress data-dependence in following up with further tightening next year and will surely not drop any heavy hints about the timing of the next move. No one can be confident how the dollar will emerge from all this but volatility seems assured," wrote Sean Callow, a senior strategist at Westpac.  The dollar index .DXY last stood at 98.126, having gained 0.6 percent on Tuesday.
> 
> The dollar gained 0.2 percent to 121.835 yen JPY=, pulling further away from a six-week trough of 120.35 struck Monday. The euro traded near $1.0900 EUR= after recoiling from a seven-week peak of $1.1060.  Supporting the greenback, Treasury yields rose overnight as gains on Wall Street reduced the appeal of safe-haven bonds and stable U.S. consumer price data reinforced the case for a Fed rate hike.  In commodities, crude oil dipped after gaining for two successive days. U.S. crude CLc1 was down 0.7 percent at $37.08 a barrel. Concerns of global oversupply had sent crude to a seven-year low of $34.53 earlier this week.
> 
> MORE



Related:

*Fed opens meeting to put an end to crisis era policy*
_Tue Dec 15, 2015 - Eight years after a devastating recession opened an era of loose U.S. monetary policy, the Federal Reserve on Tuesday began a two-day meeting at which it is expected to turn in the other direction and raise rates in an increasingly normal economy._


> The decision will be released on Wednesday at 2 p.m. (1900 GMT), with markets prepared for an initial 25 basis point "liftoff" that would move the Fed's target rate from the zero lower bound to a range of between 0.25 and 0.50 percentage points. It is to be followed by a news conference by Fed Chair Janet Yellen to elaborate on the central bank's latest policy statement.  Markets on Tuesday set a positive stage for the Fed's potentially historic turn. U.S. stock indices were up around one percent, bond yields moved higher, and analysts said that after weeks of preparation a surprise decision not to hike would be the more disruptive choice.  "Given the strength of the signals that have been sent it would be credibility destroying not to carry through," former Treasury Secretary Larry Summers, a skeptic of the need to raise rates right now, said in remarks published Tuesday on his website.
> 
> The rate hike will separate the Fed from major central banks in Tokyo, Frankfurt, Beijing and elsewhere that are all battling to stimulate their economies and generate growth.  The initial hike expected on Wednesday will still leave U.S. policy extremely loose, and Fed officials have signaled they will act cautiously from that point forward to nurture a tepid recovery.  Markets and analysts will focus on the exact language the Fed uses in its statement to justify the hike and describe how it will evaluate the timing of a second and subsequent steps.
> 
> Analysts at TD Securities said they expected the statement and updated economic forecasts from policymakers to take a hawkish tilt that emphasizes every meeting will be "live" for a possible hike.  As of September, Fed officials expected perhaps four rate hikes next year.  "The statement....should be relatively hawkish. The Fed will look to project confidence," the analysis said.  Though modest, the Fed's token first step remains fraught.
> 
> MORE


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## waltky

Granny says, "Dat's right - we gonna rue the day dey lifted the ban on oil exports...

*Oil edges up, but oversupply, strong dollar keep pressure on*
_Thu Dec 17, 2015 - Oil gained slightly on Thursday, but held close to an 11-year low, pressured by a relentless build in oversupply, and as the dollar strengthened after the U.S. Federal Reserve raised interest rates for the first time in nearly a decade._


> Brent crude for February delivery, the front-month contract from Thursday, rose 20 cents to $37.59 a barrel by 1143 GMT. The global benchmark lost 3.3 percent in the previous session.  A dip below $36.20 will be the lowest since July 2004. Analysts said such a move in the run up to year-end would be likely.  "The price action is likely to remain violent, but the odds are on lower numbers," said PVM Oil Associates technical analyst Robin Bieber. "Stick with the trend. It is not advised to be long."
> 
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> A gas pump is seen hanging from the ceiling at a petrol station in Seoul​
> Government data showed a surprise build in U.S. inventories on Wednesday, adding to a global glut that has contributed to a near 17 percent slump this month alone. Brent has tumbled from a high above $115 in June last year.  West Texas Intermediate for January delivery, the front-month contract, was down 17 cents at $35.35. U.S. crude fell nearly 5 percent on Wednesday.  Another potential source of supply for international markets would be U.S. crude should lawmakers vote to lift a ban on exports as early as Friday.
> 
> The likely lifting of the ban has seen Brent crude's premium to WTI shrink to below $1 per barrel. The premium was above $13 per barrel in March.  "OPEC countries are cutting price to get market share, and they'll have to do so even more if U.S. oil comes onto the international market," Jasper Lawler, analyst at CMC markets said.  The Fed raised rates on Wednesday, a sign it believes that the U.S. economy had largely overcome the calamity that was the 2007-2009 financial crisis.  Higher U.S. rates typically support the dollar, making dollar-priced oil more costly for holders of other currencies and undermining demand.
> 
> MORE



See also:

*Oil price slide unlikely to scuttle Shell's takeover of BG*
_Thu Dec 17, 2015 - Royal Dutch Shell's takeover of BG Group may look less attractive after the slide in oil prices but the fact the same investors own nearly half of both firms means the deal is still likely to go through._


> Investors holding about 43 percent of Shell's shares also hold 53 percent of BG, according to Reuters data. For example, Blackrock, Franklin Mutual Advisers and Norges together hold more than 12 percent of Shell and nearly 7.5 percent of BG.  Investors will be voting separately on the deal at meetings expected next month after the takeover received its final regulatory seal from China this week and a rejection of the takeover could entail losses all round, making it more painful for those with shares in both companies.
> 
> 
> 
> 
> 
> Shell's company logo is pictured at a gas station in Zurich​
> BG shares would likely collapse, while Shell would lose a rare opportunity to increase its production base over the next few decades by snapping up a smaller company with some key assets, investors and analysts say.  "I think the vote will be positive for the deal," said Niels Lammerts van Bueren, portfolio manager at Dutch arbitrage fund TRZ Funds that trades shares in both companies. "Indeed, with the cross-holdings very few holders will be voting against as that will cost them money."
> 
> Few investors and analysts have challenged the strategic sense of a merger that will make Shell the world's top liquefied natural gas (LNG) trader and a key player in Brazil's rapidly developing offshore oil production.  But the 30 percent slump in oil prices to below $40 a barrel since the takeover was announced in April has left investors worrying about whether Shell will be able to maintain its dividend if the $54 billion takeover goes through.
> 
> SHARES LAG


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## waltky

Oil heads for third straight weekly loss...

*Oil heads for third straight weekly loss as supply weighs*
_Fri Dec 18, 2015 - Oil prices edged higher on Friday as investors closed positions ahead of the end of the year though crude was still heading for a third weekly loss in a row, its longest losing streak in four months._


> Global benchmark Brent crude prices were trading up 38 cents at $37.44 a barrel at 1000 GMT while U.S. crude futures traded at $35.02 a barrel, a rise of seven cents from Thursday's close.  A global supply glut that brought prices close to 11-year lows this week means Brent oil prices will post losses for a third consecutive year, which would be the first time that has happened since oil trading started in the 1980s.  West Texas Intermediate (WTI) futures are set for a second straight yearly loss, the first time that will have happened for the U.S. oil pricing benchmark since 1998.
> 
> Many investors finished closing their books for 2015 on Friday ahead of the holiday break and some expected oil prices to rise further during the day as others closed out positions that had been benefiting from the slide in prices.  "I would not be surprised to see some rally today as some kind of pre-weekend profit taking," PVM Oil Associates analyst Tamas Varga said.  Still, traders were preparing for even lower crude prices next year by taking up more put options to sell U.S. crude in February should prices fall to $30, $25 or even $20 per barrel, according to Reuters data.
> 
> The seemingly unstoppable decline in oil is raising concerns about investment in future supplies, IEA Executive Director Fatih Birol said on Friday in Singapore.  "The current low oil price make me worried because it means lower investments in new oil projects," he said.  "This year, oil investments declined more than 20 percent and more importantly we expect it will decline next year as well," Birol said. "We have never seen in the last 30 years oil investments decline two years in a row in the world."
> 
> Oil heads for third straight weekly loss as supply weighs


----------



## waltky

... 'a surprise drop in U.S. crude inventories' - dat domestic crude Jeb Bush an' his buddies been sellin' off...

*Oil up 3 percent after U.S. crude stocks drop, trade thin*
_23 Dec.`15 -  Oil rose more than 3 percent on Wednesday in thin, pre-holiday trading, buoyed by a surprise drop in U.S. crude inventories, but prices stayed near multi-year lows as global supplies remained abundant and OPEC lowered the demand outlook for its exports._


> Ahead of the Christmas holiday on Friday, volume in the front-month U.S. crude contract was around 265,000 lots by midday, slightly less than the 294,000 lots on Tuesday, according to Thomson Reuters Eikon data.  At 12:40 p.m. EST (1740 GMT), West Texas Intermediate futures <CLc1> were up $1.38 at $37.52 a barrel, while Brent crude futures <LCOc1> were up 99 cents at $37.10 a barrel.  A day earlier Brent touched $35.98, its lowest since July 2004.
> 
> U.S crude inventories fell 5.88 million barrels to 484.78 million last week compared with a forecast rise of 1.4 million, the Energy Information Administration (EIA) said.  "The inventory draw painted a good picture for the bulls because it was larger than a lot of people were expecting," said Oliver Sloup, director of managed futures at iiTrader.com in Chicago. "It's prompting some short covering going into the holiday week and we're seeing some house cleaning by a lot of traders."
> 
> 
> 
> 
> 
> Oil rig pumpjacks, also known as thirsty birds, extract crude from the Wilmington Field oil deposits area where Tidelands Oil Production Company operates near Long Beach, California​
> On Wednesday, the front-month WTI contract traded as much as 56 cents over Brent, inverting a long-standing discount following last week's signing into law a bill repealing the decades-old U.S. crude ban.  Although no immediate large-scale exports are expected, Enterprise Products Partners on Wednesday said it won its first contract to export U.S. crude oil for trader Vitol in what may become the first such cargo.  Meanwhile, the Organization of the Petroleum Exporting Countries (OPEC) in a report on Wednesday forecast that demand for its crude would be lower in 2020 than in 2016 as rival producers prove more resilient than expected in a low oil price environment.
> 
> It forecast 2020 demand for OPEC crude at 30.7 million barrels per day (bpd) versus 30.9 million bpd in 2016 and about 1 million bpd less than it is currently producing.  Saudi King Salman said on Wednesday the kingdom was concerned about the stability of the oil market, but added that Saudi Arabia remained committed to further exploration activities in the oil and gas sectors. and  Iran is expected to add 500,000 bpd of crude exports next year and Iranian officials have already met with Indian refiners seeking proposals on how to make their crude more competitive.
> 
> Oil up 3 percent after U.S. crude stocks drop, trade thin


----------



## waltky

Uncle Ferd don't care - long as he can fill his gas tank for less'n $50...

*Low Oil Prices Are Double-edged Sword for Global Economy*
_ December 24, 2015 | WASHINGTON — Experts and investors say low oil prices are likely to continue hurting energy companies and the economies of emerging nations that depend heavily on crude oil exports, even though prices have been rising for the past few days._


> Oil prices had been at an 11-year low but started to rise after a report this week said U.S. inventories of crude dropped more than analysts had expected.  The change in the balance between supply and expected demand pushed up crude prices, but they're still well below $40 -- drastically lower than the $110 a barrel seen 18 months ago.  The lower oil prices have been a boon for oil importers and consumers.  Average U.S. gasoline prices have now fallen below 53 cents per liter – an early Christmas present for U.S. motorists who had been paying $50 to fill their tanks, but now can fill the tank for about $37.
> 
> 
> 
> 
> 
> Industrial plant strips natural gas from crude oil at Saudi Aramco's Shaybah oil field, Shaybah, Saudi Arabia​
> It amounts to a $115 billion boost to the U.S. economy -- or a yearly savings of $555 for every motorist, said Robert Sinclair, spokesman for the U.S. auto club called AAA.  “We think it’s something that is going to continue, plenty of crude oil supply still remains. Crude oil futures are pointing to even lower prices as we go forward in the next month or so -- so we could see prices drop another 25 or 30 cents in the next month,” Sinclair said.
> 
> Oil-producing nations
> 
> For oil-producing countries, the price declines have been bad news, economist C. Fred Bergsten told the HasthtagVOA program.  “The Russians lose, the Saudis lose, the Venezuelans lose, U.S. oil shale producers lose; but that is more than offset by the net reduction in consumer costs,” Bergsten said.  Key oil exporter Saudi Arabia is seeking to diversify its economy, and is running a budget deficit, while Venezuela is dealing with high inflation and a stalled economy, and oil-rich Azerbaijan was forced to depreciate its currency, the manat, which fell more than 30 percent against the dollar.
> 
> 
> 
> 
> 
> Oil technician Majid Afshari makes his way to the oil separator facilities in Iran's Azadegan oil field southwest of Tehran​
> Because most commodities are priced in U.S. dollars, some blame the higher exchange rate for price declines. But analyst Peter Cardillo of First Standard Financial said faltering demand and growing supply are far bigger factors.  "If you have lower demand on a global scale, and then you have overproduction from producing nations, it's obvious that you're going to have a crash in oil prices, and that's exactly what's happened," Cardiollo said in an interview with VOA in New York.
> 
> *Consequences*


----------



## waltky

Crude oil price losses give back gains...

*Crude oil prices drop more than 1 percent as weak outlook prevails*
_Tue Dec 29, 2015 - Crude oil futures fell around half a dollar early on Wednesday as the market remained under pressure from slowing demand and high supplies, while forecasts that a cold snap in Europe and the United States would be short-lived also hurt prices._


> Crude prices have plunged by two-thirds since mid-2014 as soaring output from the Organization of the Petroleum Exporting Countries, Russia and the United States led to a global surplus of between half a million and 2 million barrels per day.  More recently, a slowing demand outlook, especially in Asia but also Europe, has started dragging on prices.  Front-month U.S. West Texas Intermediate crude futures CLc1 were trading at $37.18 per barrel at 0140 GMT, down 69 cents or 1.82 percent from their last settlement. Brent futures LCOc1 were down 47 cents, or 1.24 percent, to $37.32 a barrel.
> 
> Traders said the price falls were largely a result of a weak outlook for next year and the closing of 2015 trade books.  "The 2016 outlook is for lower prices, especially early next year. Many are closing their last long positions for the year today as nobody wants to come back in January and be surprised badly. Better start with a clean sheet," a trader said.  Forecasts that an upcoming cold weather in Europe will only be short-lived could also hurt crude prices.
> 
> U.S. crude and Brent had both rallied about 3 percent in the previous session on hopes that a drop in temperatures would buoy demand for oil for heating purposes.  But weather data in Thomson Reuters Eikon shows that average continental European temperatures are expected to drop from around 5 degrees Celsius currently toward and slightly below the seasonal norm of 2.4 degrees by Jan. 3 before rising to as high as 6-8 degrees by Jan. 7.  For most of the United States, a brief cold period is also not expected to last for much more than a week.
> 
> Crude oil prices drop more than 1 percent as weak outlook prevails



See also:

*Asian stock erase gains as crude oil rebound fizzles*
_Tue Dec 29, 2015 - Asian shares unwound early gains on Wednesday, as investors turned cautious following renewed selling in recently battered crude oil futures._


> MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS erased a positive start to edge down 0.1 percent, on track for a flat monthly performance and down 12 percent for the year.  U.S. crude futures CLc1 skidded 1.8 percent to $37.19 a barrel, while Brent LCOc1 shed 1.2 percent to $37.32. Both had jumped 3 percent overnight, taking back ground lost in the previous session as colder weather forecasts raised expectations of more demand.  But weekly data from industry group the American Petroleum Institute (API) showed a rise of almost 3 million barrels in U.S. crude inventories, defying expectations of no change and rekindling fears of a supply glut.
> 
> On Wall Street, major U.S. indexes each gained more than 1 percent. All 10 major S&P sectors ended with gains, led by a 1.34 percent rise in the technology sector .SPLRCT, which lifted the S&P 500 .SPX to a modest increase for the year.  Japan's Nikkei .N225 was up 0.3 percent, off session highs but still poised to gain over 9 percent for the year, though down more than 3 percent for December.  "We're seeing thin volumes at year-end as the number of active participants has decreased due to the holidays," said Martin King, co-managing director at Tyton Capital Advisors.  Australian shares outperformed, up 0.9 percent and on track for their ninth consecutive day of gains.
> 
> 
> 
> 
> 
> 
> A man, holding a mobile phone, walks past an electronic stock quotation board outside a brokerage in Tokyo, Japan​
> Higher U.S. Treasury yields underpinned the dollar overnight, although yields were off highs in Asia.  The yield on benchmark 10-year U.S. Treasury notes US10YT=RR stood at 2.292 percent, compared with its U.S. close of 2.307 percent on Tuesday.  The yield on the U.S. two-year note US2YT=RR closed at 1.095 percent on Tuesday after earlier touching its highest level since April 2010.  The dollar index .DXY, which tracks the greenback against a basket of six rival currencies, was up 0.1 percent at 98.207.
> 
> The index rose to nearly a one-week high of 98.413 on Tuesday, from a nearly two-week low earlier in the session. It is up 8.8 percent for the year, though down nearly 2 percent for the month as investors pare their dollar-long positions after the U.S. Federal Reserve's widely anticipated interest rate increase earlier in December.
> 
> MORE


----------



## waltky

Let's hope it stays down...

*Oil ends 2015 down 35 percent; long, painful hangover seen*
_Thu Dec 31, 2015 - Oil prices rose on Thursday but fell as much as 35 percent for the year after a race to pump by Middle East crude producers and U.S. shale oil drillers created an unprecedented global glut that may take through 2016 to clear._


> Global oil benchmark Brent and U.S. crude's West Texas Intermediate (WTI) futures rose between 1 and 2 percent on the day on short-covering and buying support in a thinly traded market ahead of the New Year holiday.  But for 2015, both benchmarks fell double-digits for a second straight year as Saudi Arabia and other members of the once-powerful Organization of the Petroleum Exporting Countries (OPEC) again failed to boost oil prices.  The U.S. shale industry, meanwhile, surprised the world again with its ability to survive rock-bottom crude prices, churning out more supply than expected, even as the sell-off in oil slashed by two-thirds the number of drilling rigs in the country from a year ago.
> 
> The United States also took a historic move in repealing a 40-year ban on U.S. crude exports to countries outside Canada, acknowledging the industry's growth.  "You do have to tip your hat to the U.S. shale industry and their ongoing ability to drive down costs and hang in there, albeit by their fingernails," said John Kilduff, a partner at Again Capital, an energy hedge fund in New York.  Brent crude settled up 82 cents at $37.28 a barrel, rebounding from a near 11-year low of $36.10 hit earlier in the session. For the month, it was down 16 percent and for the year, it fell 35 percent. In 2014, Brent lost 48 percent.
> 
> 
> 
> 
> 
> An oil pump is seen in Varadero, Matanzas province, Cuba, during an organized tour by the state-run Cuba-Petroleo (CUPET)​
> WTI rose 44 cents to $37.04 a barrel. It slid 11 percent in December and 30 percent for the year, after a 46 percent loss in 2014.  The immediate outlook for oil prices remains bleak. Goldman Sachs has said prices as low as $20 per barrel might be necessary to push enough production out of business and allow a rebalancing of the market.  Adding to oil's woes, floods across the Midwestern United States were threatening refineries and pipelines from Illinois to Louisiana, potentially swelling the glut of domestic crude at a time when stockpiles were already at record highs.
> 
> A mild winter so far in the Northern Hemisphere due to the El Niño weather phenomenon has also slashed demand for heating oil. U.S. heating oil prices fell 40 percent for a second year in a row.  "We have brimming oil inventories in Europe," Bjarne Schieldrop, chief commodity analyst at SEB in Oslo, said. "And our predictions are that oil inventories in Asia are going to get closer to saturation in the first quarter."  Morgan Stanley said in its outlook for next year that "headwinds (are) growing for 2016 oil."  The bank cited ongoing increases in available global supplies, despite some cuts by U.S. shale drillers. "The hope for a rebalancing in 2016 continues to suffer serious setbacks," it said.
> 
> INDUSTRY PAIN



See also:

*Wall Street suffers feeble end to turbulent 2015*
_31 Dec.`15 -  - Wall Street dropped on Thursday, leaving the S&P 500 marginally lower for a year marked by record highs as well as a major selloff._


> In a reversal of one of 2015's major trends, oil shares moved higher, with the S&P energy sector up 0.34 percent and alone among gainers.  Much of the blame for this year's underwhelming stock market performance can be laid at the feet of crude oil prices, which lost a third of their value during an unprecedented global glut. The energy sector fell 24 percent, its worst annual performance since the global recession.  The S&P 500 hit a record high in May only to slump 11 percent over eight days in August over fears of a China-led global economic slowdown. The CBOE Volatility index spiked to a seven-year high before the market recovered.
> 
> 
> 
> 
> 
> Traders work on the floor of the New York Stock Exchange shortly after the opening bell in New York​
> On the last trading day of 2015, the S&P 500 fell 0.94 percent to 2,043.94 points, leaving it with a total loss of 0.71 percent for the year. The S&P's total return, including dividends, was about 1.40 percent, according to preliminary data.  "If you went to sleep on Dec. 31, 2014, and woke up today, you'd say what a dull year it's been, and yet in between we've had these wild swings," said Donald Selkin, chief market strategist at National Securities in New York.  "The lesson is that people should watch the extremes. On those big down days, hold your nose and buy - and don't be afraid."
> 
> The Dow Jones industrial average lost 2.23 percent for the year, its first annual decline since 2008. The Nasdaq Composite gained 5.73 percent after surpassing levels not seen since the dot-com bubble in 2000.  Eight of the 10 worst performers on the S&P this year were energy companies, led by Chesapeake Energy's 77-percent slump.  The consumer discretionary sector, on the other hand, was the S&P's best performer, rising 8.43 percent thanks to Netflix's 134-percent increase and Amazon's 118-percent surge.  Consumer stocks also took the top three spots on the Dow, led by Nike's 30-percent increase in 2015.
> 
> GOOD RIDDANCE!


----------



## william the wie

A few questions:

How long is the usual lag time for pipeline construction?

How much does the use of pipelines reduce delivery costs? For NG? For Crude?


----------



## Billyjack

The CME trades around 750,000,000 paper barrels per day versus around 95,000,000 liquid barrels. If you want to know what oil prices are going to do, check with Goldman Sachs, not OPEC in an over supply environment.


----------



## waltky

Iran's oil can come back on the market adding to oil glut...

*Oil slides to lowest since 2003 as Iran sanctions are lifted*
_Sun Jan 17, 2016 - Oil prices hit their lowest since 2003 in early trading on Monday, as the market braced for a jump in Iranian exports after the lifting of sanctions against the country at the weekend._


> On Saturday, the U.N. nuclear watchdog said Tehran had met its commitments to curtail its nuclear program, and the United States immediately revoked sanctions that had slashed the OPEC member's oil exports by around 2 million barrels per day (bpd) since their pre-sanctions 2011 peak to little more than 1 million bpd.  "Iran is now free to sell as much oil as it wants to whomever it likes at whatever price it can get," said Richard Nephew, program director for Economic Statecraft, Sanctions and Energy Markets at Columbia University's Center on Global Energy Policy.  Iran is ready to increase its crude exports by 500,000 bpd, its deputy oil minister said on Sunday.  International Brent crude LCOc1 fell to $27.67 a barrel early on Monday, its lowest since 2003, before recovering to $28.25 by 0103 GMT, still down more than 2 percent from their settlement on Friday.
> 
> 
> 
> 
> 
> A flame shoots out of a chimney at a petro-industrial factory in Kawasaki near Tokyo​
> U.S. crude CLc1 was down 58 cents at $28.84 a barrel after hitting a 2003 low of $28.36 earlier in the session.  "The lifting of sanctions on Iran should see further downward pressure on oil and commodities more broadly in the short term," ANZ said on Monday.  "Iran's likely strategy in offering discounts to entice customers could see further downward pressure on prices in the near term," it added.  Iran's potential new exports come at a time when global markets are already reeling from a chronic oversupply as producers pump a million barrels or more of crude every day in excess of demand, pulling down crude prices by over 75 percent since mid-2014 and by over a quarter since the start of 2016.
> 
> And although analysts expect Iran to take some time before being able to fully revive its export infrastructure, suffering from years of underinvestment during the sanctions, it does have at least a dozen Very Large Crude Carrier super-tankers filled and in place to sell into the market.  The oil price rout is also hurting stock markets, with Asian shares set to slide to near their 2011 troughs on Monday, stoking further worries about a global economic downturn.  "Growth keeps slowing ... Lower commodity prices, including oil, partly reflect weakening demand itself. In addition, the downturn in mining capex and the declining income of commodity producers is weighing on exports from Asia," said Frederic Neumann, co-head of Asian Economics Research at HSBC, Hong Kong.
> 
> Oil slides to lowest since 2003 as Iran sanctions are lifted



See also:

*Asian shares skid to 2011 levels as oil slump intensifies*
_Sun Jan 17, 2016 - Asian shares slid to their lowest levels since late 2011 on Monday after weak U.S. economic data and massive falls in oil prices stoked further worries about a global economic downturn._


> Oil prices fell as much as 4 percent on Monday, with international benchmark Brent futures LCOc1 falling below $28 per barrel LCOc1, touching their lowest level since 2003.  MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS fell 1.0 percent in early trade, extending its fall so far this month to over 11 percent.  Japan's Nikkei .N225 tumbled as much as 2.8 percent to a one-year low. It has lost 20 percent from its peak hit in June, meeting a common definition of a bear market.  In China, the Shanghai Composite index .SSEC fell nearly 2 percent, piercing through intraday lows last seen in August when China's markets nosedived.
> 
> 
> 
> 
> 
> People are reflected in a stock quotation board outside a brokerage in Tokyo, Japan​
> On Wall Street, S&P 500 .SPX hit a 15-month low on Friday, ahead of a market holiday on Monday for Martin Luther King Jr. Day.  "The fact that U.S. and European shares fell below their August lows, failing to sustain their rebound, is significant," said Chotaro Morita, chief fixed income strategist at SMBC Nikko Securities.  "We are coming to a stage where we need to consider the risk of recession in the global economy," he said.  An unexpected drop in retail sales and the third consecutive monthly fall in industrial output in December added to the latest indication that U.S. economic growth braked sharply in the fourth quarter.  Following those data, the Atlanta Federal Reserve's closely-watched GDPNow forecast model showed the U.S. economy is on track to grow 0.6 percent in the fourth quarter, slowing sharply from 2.0 percent growth in the third quarter.
> 
> U.S. companies' fourth-quarter profits are expected to decline more than 4 percent, which would be the second straight quarterly decline.  Federal Reserve officials have been stuck to a well-worn script: day-to-day financial market swings do not drive monetary policy.  But investors also further cut back their expectations on the U.S. Federal Reserve's rate hikes, with short-term interest rate futures pricing in only one rate hike by the end of year, compared to two hikes priced in at the start of year.  Outside the United States, the economic outlook appeared even bleaker, with the energy and raw material sector hit the hardest as China's massive investment-led economy slows down.
> 
> MORE


----------



## waltky

Another half million barrels a day coming on the market...

*Oil price steadies after falling below $28 a barrel*
_18 Jan.`16 - The oil price has recovered slightly after earlier falling below $28 a barrel, as Opec predicts crude will mount a recovery this year._


> Brent crude, used as an international benchmark, fell as low as $27.67 a barrel, its lowest since 2003, before recovering to trade at $28.86.  The price of US crude was $29.65 a barrel after hitting $28.36.  Investors fear the lifting of Western sanctions on Iran could worsen the existing oversupply problem.  Iran's deputy oil minister Roknoddin Javadi has expressed confidence the country can produce an extra 500,000 barrels per day.
> 
> 
> 
> 
> Phillip Futures analyst Daniel Ang said the earlier price drop was due to concerns about Iran. "This means we will be seeing a bigger oil glut with Iranian crude exports coming back to the market," he said.  However, oil producers' group Opec said in its January market report that it expected to see the price of crude begin a rebalancing process in 2016.  The group forecast that in the next six months non-Opec members would be unable to sustain production because of the continuing low oil price.
> 
> Excess supply
> 
> The decision to lift the sanctions against Iran came on Sunday after the international nuclear watchdog, the IAEA, said Iran had complied with a deal designed to prevent it developing nuclear weapons.  Iran has the fourth largest proven oil reserves in the world, according to the US Energy Information Agency and any additional oil would add to the one million barrels a day of over-supply that has led to a more than 70% collapse in oil prices since the middle of 2014.
> 
> MORE


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## waltky

Granny says ain't no unseasonably warm weather here - is colder'n a well digger's butt...

* Oil market may ‘drown in oversupply’ in 2016: IEA*
_Tuesday, Jan. 19, 2016 - Unseasonably warm weather and rising supply will keep the crude oil market oversupplied until at least late 2016 and could push the price below its current 12-year lows, the International Energy Agency said on Tuesday._


> The addition of Iranian supply to a market where production looks set to outpace consumption for a third year in a row could not come at a worse time for crude oil exporters, who are grappling with prices at their lowest in more than a decade.  Brent crude futures have fallen to their lowest level since late 2003, tumbling below $30 a barrel, after OPEC said in December it would not cut output to halt the price slide despite global oversupply.
> 
> The IEA, which issues regular reviews of the health of the energy market, said more price weakness could lie ahead as a result.  “Although we do not formally forecast OPEC oil production, in a scenario whereby Iran adds 600,000 bpd to the market by mid-year and other members maintain current output, global oil supply could exceed demand by 1.5 million bpd in the first half of 2016,” the agency said in a monthly report.  “While the pace of stock-building eases in the second half of the year as supply from non-OPEC producers falls, unless something changes, the oil market could drown in over-supply. So the answer to our question is an emphatic yes. It could go lower.”
> 
> Responding to Tehran’s compliance with a nuclear deal, the United States and other major powers have revoked international sanctions that sharply cut Iran’s oil exports.  Warm winter weather around the world cut global oil demand growth to a one-year low of 1 million barrels per day in the fourth quarter of 2015, down from a near five-year high of 2.1 million bpd in the third quarter.  The IEA left its estimate of growth in global demand for 2016 unchanged from its previous monthly report at around 1.2 million bpd.  “We conclude that the oil market faces the prospect of a third successive year when supply will exceed demand by 1 million bpd and there will be enormous strain on the ability of the oil system to absorb it efficiently,” the IEA said.
> 
> With the world economy slowing, the IEA said it had cut its forecast for 2016 OPEC crude oil demand by 300,000 bpd to 31.7 million bpd.  Iran has said it will raise output by an initial 500,000 bpd now that international sanctions have been lifted, but the IEA said it believes the increase will be of a more modest 300,000 bpd by the end of the first quarter of 2016.  The IEA is sticking with its forecast for a decline of around 600,000 bpd in non-OPEC output, which it said had been surprisingly resilient in the face of tumbling crude oil prices.
> 
> Oil market may ‘drown in oversupply’ in 2016: IEA


----------



## waltky

Ruble hits all time low...

*Oil Slump Sends Russian Ruble to All-time Low*
_ January 20, 2016 — The Russian ruble struck a new record low on Wednesday as fresh falls in world oil prices deepened investor worries about Russia's contracting, commodity-dependent economy._


> The ruble was trading down 4.6 percent at 82.16 to the dollar at 1715 GMT after earlier reaching a historic low of 82.29 earlier in the session. It was 4.6 percent lower versus the euro at 89.66.  The previous all-time low was 80.10 rubles per dollar, reached in December 2014 when Russia was in the grips of a financial crisis exacerbated by Western sanctions over the Ukraine crisis.
> 
> 
> 
> 
> 
> People walk past a currency exchange display board showing the value of the Russian ruble against the U.S. dollar and the euro, in Moscow, Russia​
> Analysts said the ruble was likely to remain on the ropes as long as oil prices continue their decline but that the central bank was unlikely to intervene to defend the currency unless financial stability was threatened.  "The ruble is trading on oil and risk sentiment," said Tom Levinson, chief forex strategist at Sberbank CIB, the investment-banking arm of Russia's largest lender Sberbank.  "Despite arguably offering good value at this level, no one is going to become neutral or positive on the ruble without signs of a recovery in oil prices."
> 
> No signs of panic
> 
> In contrast to the situation 13 months ago, there was no sign of panic buying of dollars on Moscow streets on Wednesday - a factor likely to prevent the central bank taking active steps to defend the currency.  Many Russian consumers, having spent months already watching the value of the rubles in their pockets fall, have adopted a fatalistic approach to the currency's decline.  But the ruble's slide makes it more likely the central bank will have to postpone interest rate cuts badly needed to breathe new life into the economy.  In a country where many consumer goods are imported, the ruble's drop will also push up inflation, testing so-far robust public support for President Vladimir Putin in a year when Russia holds a parliamentary election.
> 
> The central bank cut rates aggressively in early 2015 to ease the impact of an economic recession but has been forced to leave them on hold since July, despite prospects for the economy remaining grim. Russia's economy shrank an estimated 3.9 percent last year and the International Monetary Fund forecast on Tuesday another 1 percent contraction in 2016.  The bank next meets on monetary policy on January 29, and market expectations have recently shifted towards a "hold" decision.
> 
> *Global gloom*



See also:

*Oil prices fall near 2003 lows on oversupply, demand worries*
_Thu Jan 21, 2016 - Oil fell on Thursday, dipping back towards 12-year lows on persistent concerns about a supply overhang and the outlook for demand._


> Oil futures dropped to their lowest levels since 2003 this week as investors worry that a glut of crude is combining with slowing demand due to economic weakness, especially in China.  International benchmark Brent LCOc1 was down 43 cents at $27.45 a barrel by 0913 GMT. Brent has lost 26 percent so far in January, on track for its biggest monthly fall since 2008.  Front-month West Texas Intermediate (WTI) crude futures CLc1 traded at $28.09 per barrel, down 26 cents from their previous close.
> 
> 
> 
> 
> 
> A worker checks the valve of an oil pipe at Nahr Bin Umar oil field, north of Basra, Iraq​
> Broad market sentiment remained bearish as producers around the world pump 1 million to 2 million barrels of crude every day in excess of demand, creating a huge overhang of stored oil.  Iran's return to the oil market this month added to the glut, after the lifting of international sanctions to discourage the country from obtaining nuclear weapons.  "There are worries surrounding demand and oversupply," said Hans van Cleef, senior energy economist at ABN Amro in Amsterdam.  He said weaker demand in the Middle East, which has been hit by lower oil prices, could add fuel to the sell-off and there was little to stop crude falling to $20 per barrel.
> 
> Concerns are also growing that China's economy could slow further and cut demand in the world's second-largest oil consumer.  "Lower commodity and oil prices reflect weakening demand," HSBC said on Thursday.  Meanwhile, Venezuela has requested that OPEC hold an emergency meeting to discuss steps to prop up oil prices, although delegates from other members of the producer group said such a meeting was unlikely.
> 
> Oil prices fall near 2003 lows on oversupply, demand worries


----------



## waltky

Oil market takes advantage of cold snap...

* Oil gains 8% as cold snap forces bears to back off*
_Friday, Jan. 22, 2016 - Oil extended its gains and soared about 8 per cent on Friday, as a cold snap boosted demand for heating oil and investors took advantage of the lowest prices since 2003 to close out some of their more profitable bets on price declines._


> Short covering, the practice of buying back an asset sold previously at a higher price, and hopes for easier monetary policy from Europe have been catalysts to lift oil prices by 12 per cent in just two days.  The rebound has stopped the oil price heading towards a near-17 per cent drop in January, the largest slide in the first month of the year in at least a quarter of a century.  Money managers have racked up record-breaking bets against oil over the past few months. The price slide to its lowest since late 2003 this week provided a chance for them to book a profit on some of those positions, analysts said.  “Given the volatility we’ve seen in the oil price, even intraday, swings of 3 to 4 per cent, if you are going to see a rebound, this is the kind of rebound you’d expect,” CMC Markets analyst Jasper Lawler said.
> 
> Brent rose $2.25, or 7.7 per cent, to $31.50 (U.S.) a barrel by 11:47 a.m. EST (16:47 GMT), set for its biggest one-day rise since August. U.S. crude rose $2.04 to $31.57 per barrel.  Heating oil futures led the markets higher, with ICE gas oil futures soaring more than 10 per cent, their biggest percentage gain since January 2009. U.S heating oil was up more than 8 per cent, its biggest one-day gain since August.  Freezing conditions and snowstorms have gripped parts of Europe and the United States, threatening to cripple a broad swath of the Northeast, the world’s largest heat oil market, with about 2 feet (61 cm) of snow.  In the longer run, however, the cold snap may not be quite the boon oil bulls were hoping for.
> 
> Still, some analysts were optimistic and believe oil prices may have finally hit a bottom, but maintained that the overwhelming bearishness of investors and oversupply woes persist.  “I think panic took over common sense and now we’re starting to get a grip on reality,” said Phil Flynn, analyst at Price Futures Group in Chicago.  “There’s no doubt, there are fundamentals out there that mean weaker energy prices, but a price of $26 a barrel is pricing in a global recession and we’re not in one”
> 
> Oil gains 8% as cold snap forces bears to back off


----------



## waltky

OPEC cryin' uncle...

*Oil prices in reverse amid Opec call*
_25 Jan.`16 - Oil prices tumbled again on Monday, eroding last week's gains, as Opec called for co-operation from oil-producing nations outside the cartel.  Brent crude fell 6.3% to $30.15 a barrel following a 10% rise on Friday, while US oil shed 7.1% to $29.90._


> The slide came as the head of Opec called for all oil-producing nations to work together.  Abdullah al-Badri said both Opec and non-Opec oil producers needed to tackle oversupply to help prices rise.  "It is vital the market addresses the issue of the stock overhang. As you can see from previous cycles, once this overhang starts falling then prices start to rise," he told a conference in London.  Despite the ongoing refusal of Saudi Arabia, the dominant Opec member, to cut production, Mr al-Badri nevertheless blamed countries outside the cartel for the huge global oil glut.  "Yes, Opec provided some of the additional supply last year, but the majority of this has come from non-Opec countries," he said.  Opec accounts for almost 42% of the world's oil production.
> 
> Analysis: Andrew Walker, BBC Economics Correspondent
> 
> What's an oil producer to do amid tumbling prices?   Ask everybody in the business to cooperate, it seems.  If you're Opec, that means asking non-members, such as Russia to join in with curbing production.  It must be said that the prospects of any co-operation from outside Opec are weak at the best of times.  But it has got harder in the last decade.  The surge in US shale oil means it is much more difficult to manage the market without American co-operation, which would never be forthcoming.  The US government wouldn't want to work with Opec, and in any case private companies are the ones taking the decisions.  They will cut if makes commercial sense to them and their shareholders.
> 
> 
> 
> 
> 'Future at risk'
> 
> The Opec secretary-general said all major producers should agree on methods to reduce stockpiles and thus help prices recover.  "The current environment is putting this future at risk. At current price levels, it is clear that not all of the necessary future investment is viable," Mr al-Badri said.  Prices briefly fell to less than $28 a barrel earlier this month.  HSBC has lowered its forecast for the average price of Brent crude in 2016 from $60 to $45 a barrel, while UniCredit lowered it from $52.50 to $37 a barrel.  The prospect of Opec members cutting production remains unlikely. Indonesia's Opec representative said that only one member of the cartel supported calling an emergency meeting to discuss ways of boosting oil prices.  The chairman of Saudi Aramco, the state-owned oil giant, said on Monday that prices would ultimately rise to a moderate level as global demand increased.
> 
> The Iraqi government said on Monday that oil output reached a record high in December, producing as much as 4.13m barrels a day.  Hans van Cleef, senior energy economist at ABN Amro in Amsterdam, said: "The news that Iraq has probably hit another record builds on the oversupply sentiment. The oversupply will keep markets depressed and prices low."  Iran, which has the world's fourth-biggest oil reserves, is also preparing to resume exports now that sanctions have been lifted.  A fall in the number of oil rigs in the United States, one of Opec's biggest production rivals, could reduce output, with Goldman Sachs predicting a decline of 95,000 barrels per day this year.  Analysts at Energy Aspects said global oil inventories would continue to rise in the next few months, but should start to decline by the summer.
> 
> Oil prices in reverse amid Opec call - BBC News


----------



## waltky

Russia in cahoots with the Saudis...

*Moscow says ready to discuss global oil cut*
_Friday 29th January, 2016  - Russia has said that OPEC leader Saudi Arabia had proposed global oil production cuts of up to 5 percent in what could likely be the first major move to help clear a glut of crude and push up sinking oil prices._


> Benchmark Brent futures on Thursday jumped as much as 8 percent to nearly $US36 a barrel on news of the potential deal, which if implemented would immediately reduce surplus global output exceeding demand by I million barrels per day.  Oil prices jumped 5 percent to near $35 a barrel on Thursday after reports said Russia's Energy Minister Alexander Novak said the Saudis had proposed that oil producing countries cut production by up to 5 percent, which for non-OPEC member Russia - the world's top producer - would represent around 500,000 bpd.  "Indeed, these parameters were proposed, to cut production by each country by up to 5 percent," Novak said. "This is a subject for discussions, it's too early to talk about."  "We think it's reasonable to discuss the situation," he added.
> 
> The two countries have been holding discussions for almost 18 months about the oil collapse, but have never come close to an agreement.  Saudi Arabia has said it can cut oil production to shore up prices only if the largest non-OPEC members mainly Russia join the cuts. There has been no comment from Saudi Arabia's top oil officials so far on Thursday.  According to Bloomberg, OPEC delegates said they have no meeting planned with Russia following Novak's statement.  Russia has previously said it is unable to cut production due to the harsh winter climate and the many private companies operating in the sector.  But of late there have been several signs of softening of that position.
> 
> 
> 
> 
> Andrey Polischuk, oil and gas analyst at Raiffeisen Bank, said that key is US shale oil production which is expensive to drill.  "The most important trigger for this year is a possible drop in non-OPEC production, such producers have very high costs and currently [prices] are too low for maintaining the current level of production," according to euronews.  Saudi Arabia has been trying to make it uneconomic for the shale producers by flooding the market resulting in the glut and massive price slump, but now no one can afford to pump less knowing others would step in to fill the gap and there is the risk of losing market share to competitors.
> 
> That applies particularly to Russia, which is very dependent on oil revenues and also facing technical difficulties in reducing production in winter.  "It's possible that Russia could be testing the waters to gauge how OPEC members would respond to the idea of cuts," said Jason Bordoff, director of the Center on Global Energy Policy at Columbia University and a former senior oil official at the White House, according to bloomberg.  Oil rose as much 7.8 percent to $34.82 a barrel in New York trading, the highest since Jan. 6, after Novak's comments were reported. It traded at $33.48 as of 11:18 a.m. local time, paring its decline this year to 9.8 percent.
> 
> Moscow says ready to discuss global oil cut


----------



## william the wie

waltky said:


> Russia in cahoots with the Saudis...
> 
> *Moscow says ready to discuss global oil cut*
> _Friday 29th January, 2016  - Russia has said that OPEC leader Saudi Arabia had proposed global oil production cuts of up to 5 percent in what could likely be the first major move to help clear a glut of crude and push up sinking oil prices._
> 
> 
> 
> Benchmark Brent futures on Thursday jumped as much as 8 percent to nearly $US36 a barrel on news of the potential deal, which if implemented would immediately reduce surplus global output exceeding demand by I million barrels per day.  Oil prices jumped 5 percent to near $35 a barrel on Thursday after reports said Russia's Energy Minister Alexander Novak said the Saudis had proposed that oil producing countries cut production by up to 5 percent, which for non-OPEC member Russia - the world's top producer - would represent around 500,000 bpd.  "Indeed, these parameters were proposed, to cut production by each country by up to 5 percent," Novak said. "This is a subject for discussions, it's too early to talk about."  "We think it's reasonable to discuss the situation," he added.
> 
> The two countries have been holding discussions for almost 18 months about the oil collapse, but have never come close to an agreement.  Saudi Arabia has said it can cut oil production to shore up prices only if the largest non-OPEC members mainly Russia join the cuts. There has been no comment from Saudi Arabia's top oil officials so far on Thursday.  According to Bloomberg, OPEC delegates said they have no meeting planned with Russia following Novak's statement.  Russia has previously said it is unable to cut production due to the harsh winter climate and the many private companies operating in the sector.  But of late there have been several signs of softening of that position.
> 
> 
> 
> 
> Andrey Polischuk, oil and gas analyst at Raiffeisen Bank, said that key is US shale oil production which is expensive to drill.  "The most important trigger for this year is a possible drop in non-OPEC production, such producers have very high costs and currently [prices] are too low for maintaining the current level of production," according to euronews.  Saudi Arabia has been trying to make it uneconomic for the shale producers by flooding the market resulting in the glut and massive price slump, but now no one can afford to pump less knowing others would step in to fill the gap and there is the risk of losing market share to competitors.
> 
> That applies particularly to Russia, which is very dependent on oil revenues and also facing technical difficulties in reducing production in winter.  "It's possible that Russia could be testing the waters to gauge how OPEC members would respond to the idea of cuts," said Jason Bordoff, director of the Center on Global Energy Policy at Columbia University and a former senior oil official at the White House, according to bloomberg.  Oil rose as much 7.8 percent to $34.82 a barrel in New York trading, the highest since Jan. 6, after Novak's comments were reported. It traded at $33.48 as of 11:18 a.m. local time, paring its decline this year to 9.8 percent.
> 
> Moscow says ready to discuss global oil cut
Click to expand...




waltky said:


> Russia in cahoots with the Saudis...
> 
> *Moscow says ready to discuss global oil cut*
> _Friday 29th January, 2016  - Russia has said that OPEC leader Saudi Arabia had proposed global oil production cuts of up to 5 percent in what could likely be the first major move to help clear a glut of crude and push up sinking oil prices._
> 
> 
> 
> Benchmark Brent futures on Thursday jumped as much as 8 percent to nearly $US36 a barrel on news of the potential deal, which if implemented would immediately reduce surplus global output exceeding demand by I million barrels per day.  Oil prices jumped 5 percent to near $35 a barrel on Thursday after reports said Russia's Energy Minister Alexander Novak said the Saudis had proposed that oil producing countries cut production by up to 5 percent, which for non-OPEC member Russia - the world's top producer - would represent around 500,000 bpd.  "Indeed, these parameters were proposed, to cut production by each country by up to 5 percent," Novak said. "This is a subject for discussions, it's too early to talk about."  "We think it's reasonable to discuss the situation," he added.
> 
> The two countries have been holding discussions for almost 18 months about the oil collapse, but have never come close to an agreement.  Saudi Arabia has said it can cut oil production to shore up prices only if the largest non-OPEC members mainly Russia join the cuts. There has been no comment from Saudi Arabia's top oil officials so far on Thursday.  According to Bloomberg, OPEC delegates said they have no meeting planned with Russia following Novak's statement.  Russia has previously said it is unable to cut production due to the harsh winter climate and the many private companies operating in the sector.  But of late there have been several signs of softening of that position.
> 
> 
> 
> 
> Andrey Polischuk, oil and gas analyst at Raiffeisen Bank, said that key is US shale oil production which is expensive to drill.  "The most important trigger for this year is a possible drop in non-OPEC production, such producers have very high costs and currently [prices] are too low for maintaining the current level of production," according to euronews.  Saudi Arabia has been trying to make it uneconomic for the shale producers by flooding the market resulting in the glut and massive price slump, but now no one can afford to pump less knowing others would step in to fill the gap and there is the risk of losing market share to competitors.
> 
> That applies particularly to Russia, which is very dependent on oil revenues and also facing technical difficulties in reducing production in winter.  "It's possible that Russia could be testing the waters to gauge how OPEC members would respond to the idea of cuts," said Jason Bordoff, director of the Center on Global Energy Policy at Columbia University and a former senior oil official at the White House, according to bloomberg.  Oil rose as much 7.8 percent to $34.82 a barrel in New York trading, the highest since Jan. 6, after Novak's comments were reported. It traded at $33.48 as of 11:18 a.m. local time, paring its decline this year to 9.8 percent.
> 
> Moscow says ready to discuss global oil cut
Click to expand...


----------



## william the wie

As soon as there as a definite price pipelines to the oil patch to drop marginal shipping cost to market by at least half will upset that applecart.


----------



## waltky

China continues to slide as oil continues it's price decline...

*Oil falls on China economic woes, rising OPEC supply*
_Tue Feb 2, 2016 - Oil prices fell for a second session in Asian trade on Tuesday as worries about top energy consumer China and rising oil supply weighed on markets, although possible talks between OPEC and Russia on output cuts offered some support.  Brent for April delivery LCOc1 had dropped 66 cents to $33.58 a barrel as of 0502 GMT, after settling down $1.75, or 4.9 percent, in the previous session._


> The front month contract for West Texas Intermediate (WTI) CLc1 was down 71 cents at $30.91 after falling $2.00, or 5.9 percent, the session before.  Despite the declines, U.S. crude is still nearly 19 percent above the more than 12-year low of $26.19 hit in mid-January.  The fall in oil prices reflected the general negative sentiment in the Asia time zone, said Ric Spooner, chief market analyst at Sydney's CMC Markets.  "Stocks markets are down; oil is weakening. It all points towards negative risk sentiment across the board," he said.  MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was down almost 0.9 percent, while Japan's Nikkei .N225 slipped 0.6 percent.
> 
> The dollar index .DXY also slipped.  "(Prices) have just come back to reality a bit, although they are holding water above $30 a barrel," said Ben Le Brun, market analyst at Sydney's OptionsXpress, pointing to concern over rising oil supplies and weaker economic data.  Oil prices could nudge below $30 a barrel again if investors saw hopes fading of a deal between members of oil producers cartel OPEC and Russia on production cuts, he said.  Russia's energy minister and Venezuela's oil minister discussed the possibility of holding joint consultations between OPEC and non-OPEC countries in the near future, the Russian Energy Ministry said on Monday.
> 
> 
> 
> 
> 
> Pump jacks are seen at the Lukoil company owned Imilorskoye oil field outside the West Siberian city of Kogalym, Russia​
> But Goldman Sachs said it was "highly unlikely" OPEC producers would co-operate with Russia to cut output, while also being self-defeating as stronger prices would bring previously shelved production back to the market.  Crude prices fell after China's purchasing managers index dropped to a three-year low in January, coupled with climbing oil supplies, ANZ said in a note on Tuesday.  "Rising supply also suggests further downside risk to short-term prices. Output from OPEC rose to 33.1 million barrels per day last month as Indonesia's membership to the group was reactivated," the note added.
> 
> Investors are waiting on a slew of economic data, including U.S. non-farm payroll and unemployment figures and producer prices from the euro zone, to give oil markets further direction, Le Brun added.  That came as U.S. commercial crude oil inventories likely rose by 4.7 million barrels last week to a new record high of 499.6 million barrels, a preliminary Reuters survey taken ahead of industry and official data showed on Monday.  The Reuters poll was taken ahead of weekly inventory reports from industry group the American Petroleum Institute (API), due out later on Tuesday, and the U.S. Department of Energy's Energy Information Administration (EIA), due for release on Wednesday.
> 
> Oil falls on China economic woes, rising OPEC supply



See also:

*Asian shares slip as crude resumes drop*
_Tue Feb 2, 2016 - Asian shares fell on Tuesday as crude oil prices slid on oversupply fears and after downbeat manufacturing data raised concerns about sluggish global economic growth.  Spreadbetters predicted European bourses would follow Asia lower, with IG predicting Britain's FTSE 100 .FTSE would start trading down 0.6 percent. Germany's DAX .GDAXI was seen falling 0.7 percent, and France's CAC 40 .FCHI was expected to open down 0.6 percent._


> MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was down about 1 percent.  Japan's Nikkei .N225 ended down 0.6 percent as investors locked in profits after two straight days of big gains following the Bank of Japan's decision to introduce negative interest rates late last week. [.T]  U.S. crude oil CLc1 fell 1.8 percent to $31.05 a barrel after skidding as much as 7 percent overnight, pressured by weak economic data from China, a U.S. forecast for mild weather and doubts that suppliers would be able to agree on steps to address the global supply glut. [O/R]  Despite the declines, U.S. crude is still nearly 19 percent above the more than 12-year low of $26.19 hit in mid-January.  "(Prices) have just come back to reality a bit, although they are holding water above $30 a barrel," said Ben Le Brun, market analyst at Sydney's OptionsXpress, pointing to concern over rising oil supplies and weaker economic data.
> 
> Brent April crude futures LCOc1 slipped 1.6 percent to $33.69.  Oil faced fresh pressure after Chinese January manufacturing data on Monday showed activity contracted at the fastest pace since 2012.  Despite the weak factory reading, Chinese shares bucked regional softness and rebounded on Tuesday, led by small-cap shares. The Shanghai Composite Index .SSEC was up 1.8 percent, while the bluechip CSI300 index .CSI300 added 1.8 percent.  "In a bear market, investors would use any rebound to cut equity holdings, and that has been the trading pattern recently," said Zeng Yan, an analyst at Zhongtai Securities.  "There are no changes in fundamentals: yuan depreciation concerns are still there, the economy remains in bad shape, and market liquidity tends to be tight."  The Australian dollar was down about 0.5 percent at $0.7075 AUD=D4, though it held above its recent seven-year trough of $0.6827.
> 
> 
> 
> 
> 
> People are reflected in a stock quotation board outside a brokerage in Tokyo, Japan​
> As expected, the Reserve Bank of Australia held interest rates steady at a record low of 2.0 percent. Although the bank was hopeful on growth prospects, it reiterated that there was scope for a further cut if needed to support the economy.  The greenback slipped about 0.3 percent against its Japanese counterpart to 120.65 yen JPY=, but remained underpinned by the BOJ's surprise rate move on Friday.  Markets were little fazed by results of Iowa's Republican presidential nominating primary election, in which U.S. Senator Ted Cruz beat billionaire Donald Trump. On the Democratic side, former Secretary of State Hillary Clinton was in a virtual tie with rival Bernie Sanders.  S&P 500 e-mini futures ESc1 were down 0.4 percent, mostly tracking oil prices.  Wall Street marked modest losses on Monday, after January surveys of global factory activity on Monday showed the new year began much as the old one ended, with too much capacity chasing too little demand.
> 
> Global manufacturing expansion accelerated slightly but remained weak at the start of 2016 as faster growth in developed markets failed to offset a contraction in emerging economies.  U.S. economic data showed manufacturing activity contracted in January for a fourth straight month as factories grappled with a strong dollar and lower oil prices forced energy firms to further cut spending, but the pace of the decline appeared to be slowing.  The euro was up about 0.1 percent at $1.0899 EUR=, mired in recent ranges, its gains limited by the disappointing euro zone manufacturing data as well as comments from European Central Bank President Mario Draghi.  The central bank head stressed the risks facing the euro zone and reiterated the ECB was ready to review its monetary policy stance in early March.
> 
> Asian shares slip as crude resumes drop


----------



## william the wie

Thanks for the update. The next huge step down will be when pipelines start reaching the oil fields.


----------



## waltky

Not much sympathy after gougin' ever'body at the pumps...

*BP posts biggest annual loss in decades*
_Wednesday 3rd February, 2016 - British energy major BP Tuesday posted its biggest annual loss in decades of $6.48 billion, compared with a profit of $3.78 billion in 2014, while the fourth quarter replacement cost profit was $196 million as against $2.2 billion in the same quarter a year earlier, with the slump in oil prices eating into its revenues._


> The energy giant, which reported its worst annual loss in two decades, announced further job cuts totaling 7,000 by the end of 2017, with 4,000 jobs upstream to be cut during 2016 and the remaining 3,000 from the downstream by the end of 2017.  Despite strong operational performance and growing cost reductions, the lower underlying result was predominantly driven by the impact of steeply lower oil and gas prices on BP's Upstream segment, which reported a pre-tax loss for the quarter. This was partially offset by a strong set of counter-cyclical results from the Downstream segment, the company stated.
> 
> The Brent crude oil marker price averaged $44 a barrel in 4Q 2015 compared with $77 a year earlier, and the average Henry Hub US gas marker price was $2.27 per million British thermal units compared with $4.04 in 4Q 2014.  BP took a bigger-than-expected hit at its upstream oil and gas production business and booked charges of $2.6 billion in the fourth quarter because of low oil prices, including on fields in the Gulf of Mexico, the US Utica shale acreage in Ohio and Libya.  Despite lower revenue, BP's production rose 5.4 percent to 2.26 million barrels of oil equivalent per day.
> 
> 
> 
> 
> Its refining and trading operations, benefiting from cheap fuel prices, once again offset losses in oil and gas production, although BP indicated that supply and trading weakened over the fourth quarter compared to a year earlier.  Still grappling with about $55 billion of costs from the oil spill in the Gulf of Mexico in 2010, the energy major said the focus on cost discipline and increasing efficiency would continue.  The annual controllable cash costs in 2015 were $3.4 billion lower than in 2014 and are on track to be close to $7 billion lower in 2017.
> 
> Having completed the $10 billion divestment programme announced in October 2013, BP now plans a further $3-5 billion disinvestment during 2016.  "We are continuing to move rapidly to adapt and rebalance BP for the changing environment. We're making good progress in managing and lowering our costs and capital spending, while maintaining safe and reliable operations and continuing disciplined investment into the future of our portfolio," said Bob Dudley, BP group chief executive, in a statement.  "Our plans set out a clear course for BP for the medium term and will allow us to deliver growth in the longer term. All of this underpins our commitment to sustaining our dividend and then growing free cash flow and shareholder distributions over the long term."
> 
> MORE



See also:

*Oil futures drop for 3rd session on rising crude stocks, oversupply*
_Wed Feb 3, 2016 - Oil futures extended losses into a third session in Asian trade on Wednesday, as U.S. crude stocks last week surged to more than half a billion barrels and as Iran plans to boost exports from March._


> Brent for April delivery LCOc1 had dropped 24 cents to $32.48 a barrel as of 0524 GMT, after settling down $1.52, or 4.4 percent.  U.S. crude, also known as West Texas Intermediate (WTI) CLc1, fell 22 cents to $29.66, having ended the previous session down $1.74, or 5.5 percent.  "Oil prices are coming off again. Prices are going to zig-zag for a while," said Tony Nunan, oil risk manager at Mitsubishi Corp in Tokyo.  U.S. crude stocks rose by 3.8 million barrels to 500.4 million in the week to Jan. 29, data from industry group, the American Petroleum Institute, showed on Tuesday.
> 
> Weekly inventory data from the U.S. government's Energy Information Agency is due on Wednesday.  "The (global) inventory situation is going to get worse in the second quarter as we hit the peak refining rate at the end of this quarter," Nunan said.  "(But) this has been so well documented that it's been built into prices. I do think we're close to the bottom and the bottom in prices will be this quarter."  Nunan forecast Brent would trade in a $25-$35 a barrel range in the first quarter, before slowly recovering over the rest of the year.
> 
> 
> 
> 
> 
> A worker grabs a nozzle at a petrol station in Tehran, Iran​
> A rebalancing between oil demand and supply will not come until mid-2017, Morgan Stanley said in a note on Wednesday.  Implied crude stocks are set to climb by 1.1 million barrels per day this year, compared with an implied stock build of 1.3 million bpd last year, the note said.  "Despite the myriad announcements of capex cuts, production has yet to respond enough to rebalance the market," Morgan Stanley said.  Production numbers from Canada, Brazil and Russia all grew last year, with Russian output in December hitting the highest level since the 1980s, the note said.
> 
> The increase in stocks at Cushing has led to renewed fears of overflowing oil tanks at the key U.S. storage hub, causing the spread between prompt and forward U.S. crude oil futures to slump to an 11-month low, stoking fears of a further price rout.  Meanwhile, Iran is aiming for crude exports of 2.3 million barrels per day in the fiscal year beginning March 21, the managing director of the National Iranian Oil Company was quoted as saying on Tuesday.  That is higher than the 1.44 million bpd Iran is expected to export in February and 1.5 million bpd in January, according to data on Iran's preliminary tanker loading schedules.  South Korea, which imported 5.7 million tonnes of crude from Iran last year, unveiled a set of stimulus measures on Wednesday.
> 
> Oil futures drop for 3rd session on rising crude stocks, oversupply


----------



## william the wie

Interesting throwaway line on Bloomberg last night..
60-180 days investment to production cycle in fracking.
the same cycle for big oil/gas 5 years.

If pipeline innovations start accumulating for the relatively small fields of fracking then that cycle will shorten considerably. Due to the much lower transport costs of pipelines  any advances could reduce this cycle even further.


----------



## waltky

Dollar down, oil up...

*Oil prices extend gains on dollar-slide, talk of oil producer meeting*
_Wed Feb 3, 2016 - Crude oil futures extended gains from the previous session on Thursday, as a weaker dollar and unconfirmed talk of producers potentially meeting to discuss output cuts lifted the market despite record U.S. stocks._


> Despite this, analysts said prices would remain low in 2016 and 2017 as production stays high, global demand slows, and inventories swell.  U.S. crude futures were trading at $32.68 per barrel at 0119 GMT on Thursday, up 40 cents from the previous session's close when they rallied 8 percent from below $30 per barrel.  Brent crude was up 43 cents at $35.47 per barrel.  Analysts said prices had recovered on a sliding dollar and from ongoing, yet unconfirmed, talk of a potential meeting of oil producers to cut output in support of prices, which have fallen around 70 percent since mid-2014.
> 
> But the main feature of recent oil trading has been volatility, with price swings of more than 10 percent within two trading sessions frequently occurring since mid-January.  "The weaker U.S. dollar provided some interim support to the commodity complex, but volatility in crude oil remains extreme. Climbing U.S. crude stocks remain an ongoing threat to further price weakness," ANZ bank said.  U.S. crude inventories climbed 7.8 million barrels in the week to Jan. 29 to 502.7 million barrels, compared with analyst expectations for an increase of 4.8 million barrels.  U.S. gasoline inventories rose to a record high, soaring 5.9 million barrels to 254.4 million barrels. Analysts had forecast a 1.7 million-barrel gain in gasoline inventories.
> 
> Despite the latest gains, analysts remain largely bearish in their oil market outlook, pointing towards persistent oversupply and swelling inventories as the main factors that are keeping prices low.  Morgan Stanley on Thursday lowered its average 2016 Brent price forecast to $30 per barrel, down from $49 previously. The bank only expects an average price of $40 per barrel in 2017 as oversupply persists.  "Until the market rebalances, prices will drift at low levels. With demand slowing, rebalancing may not occur until mid-2017 or later," it said, adding that "global supply should grow in 2016 despite low prices."
> 
> Morgan Stanley also said that an emerging willingness of producers to forward hedge at prices not much above $40 per barrel was also capping prices.  "We now see risk that producers will begin to hedge if the 12-24 month WTI strip moves into the mid-40s, which should cap prices in the front as well.
> 
> Oil prices extend gains on dollar-slide, talk of oil producer meeting



See also:

*Asia stocks jump as dollar slide boosts oil*
_Wed Feb 3, 2016 - Asian shares rallied on Thursday as speculation the U.S. Federal Reserve might opt to not raise interest rates at all this year hammered the dollar and sparked a huge rally in oil prices._


> By some measures the U.S. currency suffered its largest one-day percentage drop outside of the crises of 1998 and 2008, symptomatic of just how crowded bullish positions had been.  The sudden reversal provided a much-needed boost to beleaguered commodities, sending oil up no less than 8 percent, and easing pressure on energy shares and risk appetite.  That relief showed in equity markets where MSCI's broadest index of Asia-Pacific shares outside Japan jumped 1.9 percent. Australia's resource-heavy index rose 1.7 percent and South Korea 1 percent.
> 
> In China, the Shanghai Composite Index gained 1.8 percent as trade wound down ahead of the Lunar holidays. Hong Kong stocks leaped 1.7 percent, in part because the U.S. dollar's fall lessened strains on the HK dollar's peg.  Japanese investors, however, seemed less happy with the yen's newfound strength against the dollar and nudged the Nikkei down 0.7 percent.  Wall Street had taken its cue from oil and recouped early losses on Wednesday, in a wild session that saw the Dow swing in a 420-point range.
> 
> The Dow ended Wednesday up 1.13 percent, while the S&P 500 added 0.5 percent and the Nasdaq Composite eased 0.28 percent.  Traders were unsure what triggered the dollar rout though many pointed to comments from Federal Reserve Bank of New York President William Dudley that tighter financial conditions would be taken into account at the next policy meeting in March.  In an interview with Market News International, Dudley also warned that a sharp rise in the dollar could have "significant consequences" for the U.S. economy.
> 
> MORE


----------



## waltky

Oil still down...

*Oil falls in volatile trade ahead of key oil producer meeting*
_Fri Feb 5, 2016 - Oil prices ended the week lower in choppy trading on Friday, snapping two weeks of gains, as a frenzy of speculation about a possible deal between top oil producers clashed with concerns about a growing supply glut._


> After a volatile week's trading, much is riding on Sunday's meeting between Venezuelan Oil Minister Eulogio Del Pino and his Saudi counterpart Ali al-Naimi in Riyadh, after Del Pino's discussions with the Qatari and Omani ministers this week.  As cash-strapped Venezuela tries to rally support for concerted action between members of the Organization of the Petroleum Exporting Countries to boost prices, Sunday's meeting is seen "make or break" for a possible deal, said Tim Evans, energy futures specialist at Citi Futures.  Adding to this week's rollercoaster ride in prices was the sudden liquidation of a $600 million leveraged fund bet on falling prices.
> 
> Investors were also weighing a string of conflicting indicators on Friday as the dollar .DXY recovered some of the ground lost over the past two days while investors continued to fret about growing oversupply, with U.S. inventories hitting record highs last week amid concerns about a slowing global economy.  The pickup in the market earlier this week was not really warranted, Gene McGillian, senior analyst at Tradition Energy said, referring to the market seemingly brushing aside extremely bearish inventory data earlier this week. [EIA/S]  "Today when the dollar tried to push up, which I attribute mostly to a little weekend covering, you started to see some sellers come back in the oil markets," he said.
> 
> 
> 
> 
> 
> A gasoline pump is seen hanging at a petrol station in central Seoul​
> Global benchmark Brent crude futures LCOc1 settled down 40 cents, or 1.2 percent at $34.06 a barrel, after trading between $35.14 and $33.81.  U.S. crude futures CLc1 closed 83 cents, or 2.6 percent lower, at $30.89 a barrel, after touching a high of $32.45. The contract fell slightly lower to $30.63 in post-settlement trading.  Prices briefly turned positive after data showed U.S. energy firms this week deepened their oil rig cuts in the seventh week of declines, to the lowest levels in nearly six years.  Both contracts were stuck in a narrow $1.50 range through the session but ended lower as hopes of an OPEC-led production cut that boosted prices in January have faded and concerns about a global supply glut have returned.
> 
> In a sign that low prices are having a limited impact on production, only around 100,000 barrels per day of oil production has been shut in globally to date - about 0.1 percent of global output, industry research group Wood Mackenzie said on Friday.  Morgan Stanley warned on Friday that a rebalancing in the oil market may not occur until mid-2017.  As markets try to balance themselves, it will likely lead to further volatility as investors close excessive positions, ABN Amro said in a note.  In a sign that optimism had not fully returned to the market, money managers cut their bullish wagers on U.S. crude oil in the week to Feb. 2, data from the U.S. Commodity Futures Trading Commission (CFTC) showed on Friday.
> 
> Oil falls in volatile trade ahead of key oil producer meeting


----------



## waltky

Few signs there would be steps taken to boost prices...

*Crude oil slips after Saudi, Venezuela meeting on prices yields little*
_Sun Feb 7, 2016 - Crude oil futures were mixed in early Asian trade on Monday after a meeting between OPEC producers Saudi Arabia and Venezuela to discuss coordination on prices ended with few signs there would be steps taken to boost prices._


> Brent crude futures, LCOc1 the global benchmark was down 9 cents at $33.97 at 0039 GMT. They fell 40 cents to $34.06 a barrel on Friday.  U.S. crude futures CLc1 were down 2 cents at $30.87. On Friday, the contract fell 83 cents to $30.89 a barrel.  Both contracts were up slightly earlier on Monday in see-saw trade on low volumes.
> 
> Saudi Arabia's oil minister Ali al-Naimi talked about cooperation between Organization of Petroleum Exporting Countries members and other oil producers to stabilize the global oil market with his Venezuelan counterpart on Sunday, but there was no agreement to hold an early meeting of suppliers.
> 
> Venezuela's Oil Minister Eulogio Del Pino, who is on a tour of oil producers to lobby for action to prop up prices, said his meeting with Naimi was "productive."  The prospect of a supply restraint helped oil prices rise from 12-year lows last month, even though there was widespread scepticism that a deal will happen.
> 
> Crude oil slips after Saudi, Venezuela meeting on prices yields little


----------



## waltky

Granny says, "2% - dat's another 6 cents a gallon?...

*Oil prices jump, shrug off equity slump, glut concerns*
_Mon Feb 8, 2016 - Crude oil prices jumped as much as 2 percent on Tuesday, shrugging off big drops in Japan's stock market and eroding some of the previous session's losses that were driven by festering concerns about global oversupply._


> U.S. crude CLc1 was up 49 cents at $30.18 a barrel at 0259 GMT, after rising as far as $30.30. The contract fell about 4 percent on Monday, finishing at $29.69.  Global crude benchmark Brent LCOc1 was up 35 cents at $33.23 a barrel. It settled the previous session down $1.18 at $33.88.  Prices on Monday were hit by a drop in U.S. equity markets amid persistent fears about the global economic slowdown.  But on Tuesday, oil market traders ignored a 5-percent drop in Japan's Nikkei .N225. Many Asian markets are closed for Lunar New Year holidays.  "Once again we have got a weaker U.S. dollar and I suspect that that's where the bulk of the support is coming from," said Michael McCarthy, chief market strategist at CMC Markets in Sydney.
> 
> The U.S. dollar fell against the Japanese yen =JPY as sentiment towards most risk assets turned bearish amid concerns about banking stability.  A declining dollar makes oil prices cheaper because most trade is denominated in the greenback, potentially spurring demand.  Still, the glut in world oil markets is unlikely to abate soon, with a Reuters survey showing U.S. crude stocks likely rose by 3.9 million barrels in the week ended Feb. 5.  Industry group American Petroleum Institute on Tuesday releases its weekly inventory reports <API/S> followed by official numbers from the U.S. government's Energy Information Administration on Wednesday.  "The fundamentals haven't shifted. The market remains in surplus and while that's the case, it is very difficult for prices to sustain any gains," McCarthy said.
> 
> There is also little sign of any coordination among big producers outside the United States after weekend talks between OPEC members Saudi Arabia and Venezuela on possible coordination yielded little.  That dims prospects of any initiative on curbing supply to boost prices including producers like Russia, analysts say.  "Hopes of a coordinated supply cut from OPEC and non-OPEC members continue to fade," ANZ said in a research note on Tuesday.
> 
> Oil prices jump, shrug off equity slump, glut concerns



See also:

*Global stocks dumped for safe havens as bank fears flare*
_Mon Feb 8, 2016 - Asian share markets were scorched on Tuesday as stability concerns put a torch to European bank stocks and sent investors stampeding to only the safest of safe haven assets._


> As fear overwhelmed greed, yields on longer-term Japanese bonds hit zero for the first time ever, the yen surged to a 15-month peak and gold reached its most precious since June.  Japanese Finance Minister Taro Aso felt moved enough to warn the yen's rise was "rough", something of an understatement as the Nikkei nosedived 4.9 percent.  MSCI's broadest index of Asia-Pacific shares outside Japan fell 1 percent, and would have been lower if not for holidays in many centres.  "Sentiment towards risk assets remained extremely bearish and price action reflected a market that may be capitulating," said Jo Masters, a senior economist at ANZ.
> 
> All of which magnified the stakes for Federal Reserve Chair Janet Yellen's testimony this week.  "She needs to come across as optimistic without being too hawkish and cautious without being negative," said Masters. "Hawkishness or dovishness could easily exacerbate the current sell-off, tightening financial conditions further."  Wall Street did pare its losses but still ended deep in the red. The Dow lost 1.1 percent, while the S&P 500 fell 1.42 percent and the Nasdaq 1.82 percent. [.N]
> 
> The rout began in Europe where the FTSEurofirst 300 index shed 3.4 percent to its lowest since late 2013, led by a near 6 percent dive in the banking sector.  Deutsche Bank alone sank 9.5 percent as concerns mounted about its ability to maintain bond payments. Late Monday, the German bank said it has "sufficient" reserves to make due payments this year on AT1 securities.  The cost of insuring bank debt against default also climbed to its highest since late 2013. Borrowing costs in Spain, Portugal and Italy jumped as investors demanded a fatter risk premium over safer German paper, where two-year yields hit record lows at minus 52 basis points.
> 
> FEAR FACTOR


----------



## waltky

UAE wants production cuts...

*Oil prices soar on hopes of Opec production cut*
_12 Feb.`16 - Oil prices surged as much as 12% on Friday after new suggestions that Opec nations were set to cut oil production._


> The United Arab Emirates' energy minister said that Opec members were ready to reduce output, the Wall Street Journal reported.  Venezuela's oil minister said oil-producing nations were on a "very good path" to clinch a deal.  However, traders said sharp falls on Thursday may have triggered some bargain-hunting.  Eulogio Del Pino, the Venezuelan minister, who recently visited Russia and Saudi Arabia as part of a global tour to drum up support among both Opec and non-Opec producers, said "we're on a very, very, very good path" to reducing production.
> 
> Brent crude closed up $3.30 at $33.36 a barrel in New York after falling below $30 on Thursday.  After sinking to a 12-year low of $26.05 on Thursday, US crude settled up 12%, or $3.23, to $29.44 a barrel - its biggest one-day rise since 2009.  Many traders were sceptical about the Journal's report, pointing out that Venezuela and Russia had tried in vain earlier this week to stir Saudi Arabia and other major producers into agreeing to output cuts.  However, some believe that prices would rebound sooner or later if production tightened or demand rose.
> 
> 'High volatility'
> 
> Commerzbank analysts said: "We expect declining US oil production, in particular, to drive the oil price back up to $50 per barrel by the end of the year."  Some traders still expected wilder price swings in the coming weeks. "It's not a one-way price movement anymore" in oil, said ABN Amro's senior energy economist Hans van Cleef. "We will see a period of high volatility".  Friday's price rises were also aided by figures from oil services company Baker Hughes, which said that US energy firms cut the number of oil rigs for the eighth consecutive week to the lowest levels since January 2010.
> 
> Drillers removed 28 oil rigs, bringing the total rig count down to 439, Baker Hughes said.  The jump in oil prices helped to boost sentiment on stock markets, with the FTSE 100 in London closing 3.1% higher at 5,707 points.  Wall Street was also trading higher on Friday, with the S&P 500 rising 1.8% and the Dow Jones Industrial Average up close to 2% in late trading.
> 
> Oil prices soar on hopes of Opec production cut - BBC News


----------



## waltky

Will Russia and Saudi Arabia cut a deal?...

*Oil rebounds on investor optimism over producers' deal*
_Wed Feb 17, 2016 - Crude oil futures rebounded on Wednesday on investor hopes that a deal between Saudi Arabia and Russia to freeze oil output at January levels would lead to a wider pact among producers that could eventually see production cuts to support prices._


> Brent crude LCOc1 had climbed 34 cents to $32.52 a barrel by 0455 GMT, after settling down $1.21 in the previous session. It had surged to $35.55 a barrel in early trade on Tuesday.  U.S. crude CLc1 was up 19 cents at $29.23 a barrel, having ended the last session down 40 cents.  Top oil producers Russia and Saudi Arabia on Tuesday agreed to limit oil production at January levels, provided other oil exporters joined in, but stopped short of agreeing cuts in oil output.  Iraq, Qatar and Venezuela said they would freeze output at January levels provided a deal could be agreed, while OPEC member Iran could be offered special terms to freeze oil production levels, sources said.
> 
> Oil prices initially surged on Tuesday on news of the deal but early gains were wiped out by the realization that there would be no immediate supply cuts to tackle global oversupply.  "It was a 'buy the rumor, sell the fact' event," said Ben Le Brun, market analyst at Sydney's OptionsXpress.  "The market is coming around to the idea that it is not bad news, but not as good news as it was anticipating," he said, adding that investors were hoping for production cuts.
> 
> 
> 
> 
> 
> 
> Pump jacks are seen at the Lukoil company owned Imilorskoye oil field, as the sun sets, outside the West Siberian city of Kogalym, Russia​
> Moves to freeze output at January levels will make little difference to the overall supply-demand balance this year and won't be enough to clear the 600,000 barrels per day surplus projected for the year, analysts FGE said in a note on Wednesday.  "It could pave the wave for further action to be taken should the likes of Saudi Arabia, other OPEC members and Russia deem it necessary," FGE said.  April crude futures will remain range-bound, Singapore's Phillip Futures said in a note on Wednesday.  Saudi Arabia's oil production has stagnated at slightly more than 10 million bpd throughout 2015, meaning that "all that was achieved was an agreement to continue what they were doing", Phillip Futures said.
> 
> Investors are also eyeing U.S. oil inventory data later on Wednesday for further direction on oil prices.  U.S. crude stocks rose by 3.9 million barrels to 505.9 million barrels in the week to Feb. 12, according to a Reuters poll of analysts on Tuesday.  Weekly inventory reports from industry group the American Petroleum Institute (API) and the U.S. Department of Energy's Energy Information Administration (EIA) will be released on Wednesday and Thursday respectively, a day later than usual because of a public holiday on Monday.
> 
> Oil rebounds on investor optimism over producers' deal



See also:

*Asian shares consolidate, oil swings higher*
_Tue Feb 16, 2016 - Asian shares were taking a breather on Wednesday after two sessions of solid gains, while oil prices swung higher as the market reconsidered the chances of a meaningful deal to restrict supply later in the year._


> The mood was still skittish - when China set a slightly lower guidance rate for its yuan, the yen and safe-haven bonds got an instant boost. As investors realized this was not some message from Beijing on devaluation, the moves quickly reversed.  Yet nerves had settled enough for stocks to make some modest gains. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS edged up 0.2 percent, having climbed 3 percent over the previous two sessions.
> 
> The Shanghai Composite Index .SSEC gained 0.6 percent and South Korea .KS11 0.2 percent. Japan's Nikkei .N225 eased 0.2 percent, but is still up more than 7 percent on the week.  E-Mini futures for the S&P 500 ESc1 firmed 0.2 percent after Wall Street broke its negative feedback loop with oil.  The Dow .DJI ended Tuesday with gains of 1.39 percent, while the S&P 500 .SPX added 1.65 percent and the Nasdaq .IXIC 2.27 percent. [.N]  A survey of global fund managers found they had become so cautious they were holding more cash than at any time since late 2001, an "unambiguous buy" signal according to Bank of America Merrill Lynch.
> 
> MOOD SWINGS
> 
> In commodity markets, oil was whipsawed after top exporters, Russia and Saudi Arabia, agreed to freeze output levels but said the deal was contingent on other producers joining in.  After falling sharply at first, prices recouped some ground early on Wednesday. Brent LCOc1 added 40 cents to $32.58, while U.S. crude CLc1 was up 19 cents at $29.23 a barrel.  "Albeit mostly symbolic, it is one of the first clear acknowledgments by the oil heavyweights that all is not entirely well in the current price environment," wrote Helima Croft, global head of commodity strategy at RBC Capital Markets.  "Additionally it signals a potential willingness to be more proactive later in the year. It puts the ball back in the court of those who would not or could not comply."  Markets now await minutes of the Federal Reserve's last meeting to judge the balance of opinion among policymakers on the prospect of further rate hikes.
> 
> Boston Fed President Eric Rosengren certainly sounded in no hurry to tighten. Speaking late on Tuesday, Rosengren said the Fed would need to ratchet down economic forecasts it made in December because of the uncertain global outlook.  Doubts about the pace of any further hikes kept the U.S. dollar restrained at 96.871 .DXY against a basket of currencies. It was steady on the yen at 114.05 JPY=, after finding support around 113.60.  The big loser was sterling, which has struggled so far in 2016 because of worries the UK might leave the euro zone.  Traders said UK markets face a pivotal week ahead of a two-day summit starting on Thursday at which Prime Minister David Cameron will try to persuade other leaders to support a deal to keep Britain in the European Union.  Sterling GBP= was stuck at $1.4300, having shed 1 percent against the dollar on Tuesday.
> 
> Asian shares consolidate, oil swings higher


----------



## waltky

Energy leads Wall St. rally, as oil prices jump...

*Wall St. rallies for third session, led by energy shares*
_17 Feb.`16  - U.S. stocks tallied their third straight session of gains on Wednesday, led by energy shares as oil prices jumped, while better-than-expected economic data helped allay growth fears.  Nine of the 10 major S&P sectors closed higher, with energy rising 2.9 percent._


> The S&P 500 posted its first three-day rally of 2016, and ended with its biggest three-day percentage rise since August. With Wednesday's performance, the Dow industrials had erased nearly all its losses for February.  Still, the benchmark S&P remains down 5.7 percent this year. The steep slide in oil, whose performance has been tightly tied to equities, along with fears of a China-led slowdown in global growth have rattled markets.
> 
> Oil prices rose 7 percent on Wednesday after Iran voiced support for a Russia-Saudi-led move to freeze production. Data also showed U.S. industrial production in January rose by the most in 14 months.  "Oil continues to directionally trade with equities and oil prices are higher, and more important, economic data recently has been better than feared," said Jason Ware, chief investment officer at Albion Financial Group in Salt Lake City.  "Meanwhile, the backdrop for equities is oversold...This has certainly compelled some folks who are under-invested to get back into the stock market,” Ware said.
> 
> The Dow Jones industrial average <.DJI> rose 257.42 points, or 1.59 percent, to 16,453.83, the S&P 500 <.SPX> gained 31.24 points, or 1.65 percent, to 1,926.82 and the Nasdaq Composite <.IXIC> added 98.11 points, or 2.21 percent, to 4,534.07.  The U.S. indexes built on their gains after minutes from the U.S. Federal Reserve's January policy meeting were released in the afternoon.
> 
> The minutes showed Fed policymakers worried last month that tighter global financial conditions could hit the U.S. economy and considered changing their planned path of interest rate hikes in 2016.  "The sense of what has come out of that, is that you’re not going to see a rate hike in March and you may not even see one in June," said Chuck Carlson, chief executive officer at Horizon Investment Services in Hammond, Indiana. "What it has done basically is taken that potentially negative issue off the table for the time being."
> 
> MORE


----------



## waltky

Oil prices slide again...

*Oil prices fall on oversupply concerns after US crude stocks hit record*
_Thu Feb 18, 2016 - Oil futures fell in Asian trade on Friday as a record build in U.S. crude stocks stoked concerns about global oversupply, outweighing moves by oil producers including Saudi Arabia and Russia to cap oil output._


> U.S. crude inventories rose by 2.1 million barrels last week, to a peak of 504.1 million barrels, the third week of record highs in the past month, data from the U.S. government's Energy Information Administration (EIA) showed on Thursday.  That came as Iraq's oil minister Adel Abdul Mahdi said on Thursday that talks would continue between OPEC and non-OPEC members to find ways to restore "normal" oil prices following a meeting on Wednesday.  "The market is expecting continuing inventory builds," said Tony Nunan, oil risk manager at Japan's Mitsubishi Corp in Tokyo.  "Key to any deal (to cap production) is Iran. But Iran has been clear, saying it wants to get back to its pre-sanctions (production) level," Nunan added.  "Everything is pointing to the end of this year (before there is an agreement) when Iran gets to 4 million barrels per day. By that time the pain will be so great everybody will come to the table (to agree output caps)," Nunan said.
> 
> A combination of increased global oil demand of between 1-2 million barrels per day, production cutbacks by non-OPEC members and the deal by producers to cap output could lead oil prices to climb to around $40 a barrel by year-end, Nunan said.  Brent futures had fallen 38 cents to $33.90 a barrel as of 0359 GMT, after ending the previous session down 22 cents.  U.S. crude had slipped 32 cents to $30.45 a barrel, after settling up 11 cents the session before.  The fall in oil prices hit Asian shares which slipped from near three-week highs on Friday. MSCI's broadest index of Asia-Pacific shares outside Japan fell more than 0.8 percent, but gains in previous sessions left it up 4 percent for the week.
> 
> Oil prices rose more than 14 percent in the three days to Thursday after Saudi Arabia and Russia, supported by other producers including Venezuela and Iraq, moved to freeze oil output at January's levels. Iran endorsed the plan without commitment on Wednesday,  If approved, it would be the first such deal in 15 years between the Organization of the Petroleum Exporting Countries and non-OPEC members.
> 
> MORE



See also:

*Asian shares slip from three-week high as oil rally reverses*
_Thu Feb 18, 2016 - Asian shares slipped from near three-week highs on Friday as a rally in oil prices reversed and investors remained cautious about the outlook for the global economy._


> MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.7 percent, but gains in previous sessions left it up 4 percent for the week.  Japan's Nikkei .N225 dropped 2.2 percent as the yen firmed, but remained on track for a weekly gain of 5.9 percent.  "This week is the first sign of change I have seen in 2016," Evan Lucas, market strategist at trading services provider IG, wrote in a note.  But "most fund managers are nearing their maximum levels of cash under their respective mandates. This capital needs to be deployed to confirm the change is on."
> 
> MSCI's emerging market index .MSCIEF hit a six-week high overnight on hopes that oil prices were stabilizing, but the positive sentiment didn't flow through to U.S. shares.  The S&P 500 .SPX shed 0.5 percent, dragged down by lackluster earnings from Wal-Mart Stores (WMT.N).  Oil prices reversed earlier gains on Thursday following a rise in U.S. stockpiles but look set to post their first rise in three weeks after the battered market took heart from a tentative deal by major producers to freeze output at January's highs.
> 
> Still, doubts about how much other countries will cooperate have weighed on investors, with a focus on Iran, which has pledged to increase output sharply to regain market share lost during sanctions.  Brent crude extended losses on Friday, last trading down 0.8 percent at $34.02 per barrel, but is up 2 percent for the week.  U.S. crude last traded at $30.56, off a two-week high of $31.98 hit on Thursday but up 3.8 percent so far this week.  "I would assume oil prices will face downward pressure and there will be selling into a rally," said Daisuke Uno, chief strategist at Sumitomo Mitsui Bank.
> 
> MORE



Related:

*As 2017 oil rebounds to $45, U.S. drillers begin to hedge anew*
_Thu Feb 18, 2016 - U.S. oil producers reeling from an 18-month price rout have cautiously begun hedging future production this week, fearing this may be their best chance yet to lock in a $45 a barrel lifeline for 2017 and beyond._


> As oil markets rebounded from 12-year lows this week, U.S. shale companies - for the first time in months - started inquiring and placing new hedges for the next few years, according to three market sources familiar with money flows.  Oil prices have crashed more than 70 percent in the past 20 months, driven by near-record production by the Organization of the Petroleum Exporting Countries and other producers, adding to one of the worst supply gluts in history.  On Thursday, even as immediate-delivery oil futures ended slightly higher, U.S. crude for December 2017 delivery fell more than 2 percent to $43.47 a barrel, weighed down in part by producer hedging, the sources said. The 2017 WTI price strip rose as high as $43.55 a barrel in early trade; a month ago, it hit a record low of $37.38 a barrel.
> 
> Trading volume in over-the-counter oil swaps was more than five times higher than the past three days combined, according to swaps data from the Depository Trust & Clearing Corp, available via Thomson Reuters Eikon.  The re-emergence of hedging interest, which traders said was still limited in scope for now and mainly in the form of inquiries rather than execution, came as a surprise to some, surfacing below the $50 psychological threshold that some traders had thought would be needed to coax back producers.
> 
> The activity likely reflects both the growing investor and lender pressure to safeguard heavy debt requirements down the road, as well as the fact that drilling costs continue to decline, allowing companies to break even at lower prices.  "The $45 is break-even for a lot of producers. It's not just about making a profit, it's about staying alive," one trader said.  The sources declined to say which companies were active this week, but some producers have been looking for an excuse to pounce. They may have found it this week, as prices surged on news that OPEC and non-OPEC oil producing countries would come together to freeze production at January levels and key producer Iran voiced its support for the output cap.
> 
> MORE


----------



## waltky

Crude oil still on the downside...

*Crude oil drifts lower on U.S. employment data*
_Friday 26th February, 2016 -- Crude oil prices stumbled out of the gate in morning trading Thursday in New York as U.S employment figures fell, pulling pressure away from the demand side._


> The U.S. Labor Department said seasonally adjusted initial claims for unemployment increased by 10,000 for the week ending Feb. 20 to 272,000. Employment has been a bright spot in a U.S. economy wary of the pressure on industries from lower crude oil prices.  In mid-February, U.S. Federal Reserve Chair Janet Yellen said a weak energy sector was dragging on economic growth prospects.
> 
> Crude oil prices turned positive after a weak opening in Wednesday trading after U.S. data showed an increase in gasoline demand, a trigger likely attributed to a milder winter.  Crude oil prices started the day lower in New York, however. Brent crude oil lost 0.3 percent to start the day at $34.30 per barrel. West Texas Intermediate, the U.S. benchmark price for crude oil, was down by 0.6 percent to open at $31.95 per barrel.
> 
> Midterm U.S. labor figures showed resiliency, however. No state reported an increase of more than 1,000 in initial claims. The less-volatile four-week national average of 272,000 was a reduction of 1,250 from the previous week.  Data released from the U.S. Energy Information Administration show markets still favoring the supply side. Crude oil inventories for last week increased 3.5 million barrels to hit an all-time peak above 507 million barrels, data show.
> 
> Lower crude oil prices have left energy companies with few options but to trim spending and headcounts. Continental Resources, one of the largest leaseholders in U.S. shale basins, said this week it took a loss for the fourth quarter but still managed to pull more liquids from its key reserve, the Bakken play in Montana and North Dakota. Daniel J. Graeber
> 
> Crude oil drifts lower on US employment data



See also:

*Dollar, yields rise, backed by U.S. data; stocks, oil fade*
_Fri Feb 26, 2016 - The U.S. dollar jumped on Friday and Wall Street's stock rally faded as fresh economic data kept alive Federal Reserve rate increases, while oil prices turned negative late in the session._


> The S&P 500 ended slightly lower but finished the week up 1.6 percent. Europe's FTSEurofirst 300 stock index .FTEU3 tallied a 1.6-percent rise on Friday, fueled by strength in mining shares as industrial metals such as copper CMCU3 and aluminum CMAL3 gained.  The dollar rose broadly and the dollar index .DXY, a measure of the greenback's value against six major currencies, gained 0.8 percent to post its best weekly performance since November. Against the Japanese yen, the dollar rose to a more than one-week high.  Treasury yields also rose after data showed U.S. consumer spending rose solidly in January and underlying inflation picked up by the most in four years. A report also showed U.S. gross domestic product growth in the fourth quarter was revised higher, to a 1.0 percent annual rate.
> 
> With equity markets off to a weak start in 2016 amid concerns about an economic slowdown, investors have been awaiting the Fed's next policy move after the central bank raised rates in December.  Federal funds futures FFc1 implied traders see a 36-percent chance of the Fed raising rates in June and 53-percent chance in December, both above Thursday's levels, according to CME Group's FedWatch program.  "This information today, while actually good for Main Street, is less than good for a Wall Street that has become addicted to the Fed’s largesse," said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.
> 
> The Dow Jones industrial average .DJI fell 57.32 points, or 0.34 percent, to 16,639.97 and the S&P 500 .SPX lost 3.65 points, or 0.19 percent, to 1,948.05. The Nasdaq Composite .IXIC added 8.27 points, or 0.18 percent, to 4,590.47.  European equities rallied for a second day, for a 1.6 percent gain on the week.  MSCI's gauge of global stock markets .MIWD00000PUS was up just 0.1 percent. The index was set for its biggest two-week percentage increase since October.  With oil's steep 1-1/2-year slide, equities' performance has been tightly linked to the commodity's daily fluctuations, with investors viewing oil as a proxy for the health of the global economy.
> 
> After an initial rally that pushed benchmark Brent crude prices to their highest level since early January, oil prices faded as players took profits on winning positions.  U.S. crude CLc1 settled down 0.9 percent at $32.78 a barrel, while Brent settled down 0.5 percent at $35.10 a barrel. For the week, U.S. crude gained about 11 percent.  Benchmark 10-year notes US10YT=RR fell 21/32 in price to yield 1.77 percent, up from 1.70 percent late Thursday.  “We got some pretty surprising GDP data, an upward revision, and not too many people had pegged that,” said Thomas Simons, a money market economist at Jefferies LLC in New York.
> 
> Dollar, yields rise, backed by U.S. data; stocks, oil fade


----------



## waltky

Uncle Ferd says better gas up cheap whilst ya can - gas prices goin' up again...

*Oil jumps as traders close short positions, U.S. producers cut rig count*
_Sun Mar 6, 2016 - Oil prices jumped on Monday, extending a rally that has lifted crude benchmarks by more than a third from this year's lows, as tightening supply and an improving global outlook strengthened the sentiment for a market recovery._


> Front-month Brent LCOc1 crude futures were trading at $39.49 per barrel at 0400 GMT, up 77 cents or 2 percent from their last settlement. That is up more than a third from a low hit in January, when prices fell to levels not seen since 2003.  U.S. West Texas Intermediate (WTI) futures were trading at $36.63 a barrel, up 71 cents from the last close and 40 percent above lows touched in February.  "It looks at this stage as if it (oil) has formed a little bit of a bottom and perhaps we're going to see a sustained price in the $30s, maybe trending back up to $40 dollars at some point," said Ben Le Brun, market analyst at OptionsXpress.  Le Brun said an improved economic outlook was pushing prices: "The macro picture takes all corners of the globe into account, and those corners seem to be improving ... and that's where I'm seeing the oil price tick higher."
> 
> Analysts said that strong U.S. payroll data had pushed markets on Friday and early Monday, but that attention was now shifting to Asia.  Morgan Stanley said on Monday that China's parliament, the National People's Congress, which opens its annual session this week listed "to ease market barriers for transport, oil, and gas" among key policy targets this year.  On the supply side, U.S. energy firms cut oil rigs for an 11th week in a row to the lowest level since December 2009, data showed on Friday, as producers slash costs.  Drillers removed eight oil rigs in the week ended March 4, bringing the total count down to 392, oil services company Baker Hughes Inc (BHI.N) said. [RIG-OL-USA-BHI]
> 
> Beyond a tightening supply outlook, traders said a shift in sentiment was also lifting prices as they shut down short positions and abandoned bets on further falls in prices.  Trading data shows that the number of managed short positions on WTI contracts - which would benefit from lower prices - have fallen more than a quarter since mid-February, with many new long positions betting on rising prices being opened.  Ric Spooner, chief market analyst at CMC Markets said "there's a good prospect that Brent could hit $40 ... (it) could easily do it in the next trading session."
> 
> Oil jumps as traders close short positions, U.S. producers cut rig count


----------



## waltky

Oil goin' back up again...

*Oil hits $40 a barrel amid commodities comeback*
_7 March 2016 - The oil price has gone above $40 a barrel for the first time this year as commodities continue to rally.  Brent crude, used as an international benchmark, rose more than 5% to trade at $40.83 a barrel._


> Oil dropped below $28 in January, but has since risen as part of a wider recovery in energy and metal prices.  The price of iron also shot up, rising 20% amid greater optimism about Chinese economic growth and demand for the metal in the country's refineries.  The price of Brent crude has now gone up more than 40% from the low it reached in January, although it remains 70% below its peak in the summer of 2014.  The rise is being put down to talks taking place between oil-producing countries in an effort to curb production.  No concrete agreements have been reached, but a number of key oil-producing nations are meeting in Moscow this month.  Meanwhile, ratings agency Fitch said oil prices would remain at an average of $35 a barrel this year.
> 
> Supply glut
> 
> Simon French, chief economist at Panmure Gordon, urged caution over the oil price increase, saying it might be short-lived.  "A large part of the oil price movement in recent days has been short covering, where investors having taken a bet on low prices are insuring themselves against the risk of higher prices. Very little has changed in the oil market to correct the supply glut," he added.  Commodities in general had a strong upbeat day, with prices rising for iron ore, copper and aluminium.  Iron ore rose 20%, its biggest increase in eight months, on expectations that China was cutting production.  The slowing Chinese economy has led to a fall in demand for iron ore, which has partly led to a global glut. China is one of the biggest consumers of steel in the world.  Iron ore was trading at $63.74 a tonne, which is the highest since June 2015.
> 
> The metal touched $38.30 in mid-December 2015.  The price of copper has increased by 6.9% in 2016 and aluminium is up 5.3%.  Analysis: Andrew Walker, BBC Economics correspondent:  Does this rally in the price of crude oil have legs? There are reasons to suspect that it might not.  Traders have certainly taken encouragement from the efforts among oil-producing countries to address the supply glut.  There has been no concrete agreement, though Russia, Saudi Arabia and two others did say they would freeze production, provided others came on board.  A group of producer countries are meeting in Moscow later this month. Perhaps they will agree co-ordinated action.
> 
> MORE



See also:

*Asian shares retreat on profit-taking; oil eyed*
_Mon Mar 7,`16 Asian shares fell on Tuesday as investors took profits after a month-long rally and investors grew wary of the market's near-term prospects ahead of major central bank meetings._


> Led by China, MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS fell more than a percent. Japan's Nikkei .N225 and South Korea's KOSPI .KS11 fell more than a percent each.  "We have seen a big move in markets in a very short period of time and investors are calling time ahead of the ECB and the Fed meetings in the coming days," said Kay Van-Petersen, global macro strategist at Saxo Bank in Singapore.  The European Central Bank is widely expected to ease at Thursday's policy review, but there is a lot of uncertainty about how far it would go. Meanwhile, ahead of a U.S. Federal Reserve policy meeting, fed fund futures <0#FF:> were barely pricing in one more hike this year.
> 
> Additionally, China's February exports data released in morning trade disappointed analysts' expectations, falling 25.4 percent from a year earlier, while imports fell by 13.8 percent.  Still, risk sentiment was broadly upbeat as the impressive rally in commodities markets spilled over into an array of assets such as the high-yielding Australian dollar AUD=D3 and mining giant Glencore (GLEN.L), which is up 5 percent and 35 percent, respectively in a week.  Some investors talked about a potential bottom being formed in the commodity markets as large bearish bets are unwound and hopes of more coordinated measures from oil-producing countries to stem tumbling prices grew.
> 
> Brent crude futures LCOc1 jumped to as high as $41.04 per barrel on Monday, extending their recovery from a 12-year trough of $27.10 hit in January. U.S. crude futures CLc1 also rose to $38.11 per barrel, its highest since early January.  Further improving the mood in the battered commodity sector, spot iron ore price .IO62-CNI=SI surged almost 20 percent, hitting a near nine-month high on the back of China's plans to boost short-term output.  Ecuador's Foreign Minister, Guillaume Long, said his government will host a meeting in Quito on Friday with Venezuela, Colombia, Ecuador and Mexico "to reach consensus over oil, especially prices."
> 
> MORE


----------



## william the wie

China deciding to storm the plan with more unsalable apartments and buildings and an occupancy rate on sold building of less than 1% being decreased is extend and pretend at the most psychotic Ievel I've ever heard of. Oil will keep rising until it comes apart at the seams.


----------



## waltky

Good news for Russia...

*Oil rally lifts Wall Street, extending tight correlation*
_9 Mar.`16  - U.S. stocks rose in low volume on Wednesday, led once more by the direction of the price of oil and energy sector shares._


> Crude oil and U.S. equity prices have been linked for much of 2016 to a degree that has surprised many investors. Wednesday's market action extended that trend, with WTI crude <CLc1> rising nearly 5 percent and the S&P 500 energy sector <.SPNY> up 1.5 percent. Chevron <CVX.N> jumped 4.6 percent to $92.82 and gave the biggest boost to the energy sector.  "It's not about oil being a barometer of the global economy," said Art Hogan, chief market strategist at Wunderlich Securities in New York. "A lot of it has to do with psychology."
> 
> U.S. crude and the S&P 500 have been directionally correlated on all but six trading days this year, according to Wunderlich data.  "Stability in that asset class (oil) for a period of time will allow for the correlation to break down," said Hogan.  Since Feb. 11, the S&P 500 has gained 8.8 percent, but it is still down 2.7 percent for the year.
> 
> The Dow Jones industrial average <.DJI> rose 36.26 points, or 0.21 percent, to 17,000.36, the S&P 500 <.SPX> gained 10 points, or 0.51 percent, to 1,989.26 and the Nasdaq Composite <.IXIC> added 25.55 points, or 0.55 percent, to 4,674.38.  In a week with a thin economic data calendar, markets will turn to the European Central Bank, which is expected to further ease monetary policy on Thursday.  Biotechnology stocks came under pressure a day after the U.S. government proposed a test program that would lower incentives to use higher-priced drugs when alternative treatments are available.
> 
> MORE


----------



## waltky

Oil prices may have bottomed out, now rising again...

*Oil price 'may have bottomed out'*
_Fri, 11 Mar 2016 - There is evidence that oil prices are stabilising and could even begin to rise again, says the International Energy Agency._


> It said lower oil output in the US and other countries was helping to curb the glut in the supply of oil.  The increase in supply from Iran has also been less dramatic than first feared, the IEA said.  Oil prices have plummeted 70% since June 2014, falling as low as $27 per barrel earlier this year.  The IEA, which coordinates energy policies of industrialised nations, said it now believed non-Opec output would fall by 750,000 barrels per day (bpd) in 2016, compared with its previous estimate of 600,000 bpd.  US production is forecast to decline by 530,000 bpd this year, it said.  "There are clear signs that market forces... are working their magic and higher-cost producers are cutting output," the IEA said.
> 
> Supply and demand
> 
> There has been an oversupply of oil from booming US output in recent years, thanks to the spread of fracking.  Meanwhile, members of the oil-producing cartel Opec have been reluctant to cut supply in order to "put a floor" under the the oil price, for fear of losing market share against higher-cost producers.  These two factors sent oil prices tumbling at the end of 2014 and throughout 2015.  Lower demand for oil from China, the world's second-largest consumer of commodities, has also hurt oil prices and prompted fears of a global economic slowdown.
> 
> 
> 
> 
> Many of the major oil firms have reported dramatic falls in profits and cut back billions of pounds in investments in exploration, while at least 5,000 jobs have been lost in the North Sea oil industry over the last 18 months.  Prices hit a 12-year low in January, but have since recovered to about $40 per barrel after leading Opec nation Saudi Arabia and top non-Opec producer Russia said they could freeze output.  Brent crude on Friday was 1.9% higher at $40.79, while US West Texas Intermediate oil was 2.5% higher at $38.77 per barrel.
> 
> The IEA said Opec output fell by 90,000 bpd in February because of production outages in Nigeria, Iraq and the United Arab Emirates, which lost a combined 350,000 bpd.  "Meanwhile, Iran's return to the market has been less dramatic than the Iranians said it would be; in February we believe that production increased by 220,000 bpd and provisionally, it appears that Iran's return will be gradual," the IEA said.  Iran has promised to add as much as one million bpd to global supply after securing a deal with the West in January that has seen the easing of international sanctions, imposed on the Islamic Republic over its nuclear programme.
> 
> *Seeking 'balance'*


----------



## waltky

Now that oil has rebounded, what will Janet Yellen do?...

*Crude Oil Rebounds, All Eyes on US Fed Rate Decision*
_ March 11, 2016 — Going into Friday trade, U.S. stocks were set to post their fourth weekly gain as the S&P 500 was up eight out of nine days. All 10 sectors in the index were trading higher. Since the February 11 low, the S&P 500 has gained nearly 9 percent to trade just below 2 percent year-to-date._


> Both the S&P 500 and Dow Jones Industrial Average traded through key technical levels on the charts. Traders look at these levels to confirm bullish action (or bearish, depending on the prevailing trend). The rebound was mostly led by the energy sector with crude oil trading at its best prices in over three months.  While crude oil is enjoying the spotlight, natural gas is quietly making a rebound after falling to multi-decade lows on March 1. Phil Davis, Founder of Phil’s Stock World, joined us this week, explaining why he is building positions in the physical commodity of natural gas, as well as the United States Natural Gas ETF, ticker symbol UNG.
> 
> Demand for natural gas dropped to a 31-year low in recent weeks, while storage remained at all-time highs. Davis said, “With the advent of liquid natural gas (LNG) exporting, you now have a set global price. LNG will now be exported around the world, and this oversupply will start to draw down leading to higher prices in natural gas.”  Another factor contributing to the surge in stocks is participation from the financial sector, which was largely unexpected because low-to-negative interest rates are a challenge to bank earnings and growth. Just this Thursday, the European Central Bank (ECB) announced it was cutting its main interest rate and expanding its massive bond-buying program.
> 
> Steven Kalayjian of KnowVera said more Quantitative Easing (QE) from central banks is bad for the markets because it artificially inflates asset prices.  “Since 2008, global central banks, including the Federal Reserve, have cut rates over 650 times, which has not spurred any economic growth. In fact, global GDPs are in a decline,” Kalayjian said. “The recent rally is based on false hope of more Quantitative Easing when markets should be moving on solid fundamentals like strong corporate earnings and healthy economic data.”
> 
> Mark Friedgan, Co-Founder & CIO of Eligo Energy, is in agreement with Kalayjian. “While QE may have been necessary to preserve the global economy when it began, after more than seven years of various forms of QE worldwide, it must eventually end,” Friedgan said. “The concern I have is that this end to artificial government influence on the economy will result in a day of reckoning for investors who have been chasing yield in both exchange-traded assets and private investment. The economy and markets must prove that they can survive and grow substantially without this government tailwind.”
> 
> *Week Ahead:*



See also:

*Oil prices stable as market seen bottoming, but oversupply lingers*
_Sun Mar 13, 2016 - Oil prices were stable in early trading on Monday, with global oversupply and slowing economic growth weighing on markets but prospects of falling production lending some support._


> U.S. crude futures were trading at $38.41 per barrel at 0239 GMT, down 10 cents from their last settlement.  But international Brent futures were up 6 cents at $40.45 a barrel.  While Morgan Stanley said that oil prices had likely bottomed out, it warned that a slowing economy and high production would prevent sharp rises.  "Oil prices now seem to have bottomed, even though they are likely to stay subdued for the rest of this year before starting to move higher in 2017," the U.S. bank said, adding that cheap oil had not provided the economic boost to growth that many had hoped for.  "When oil prices are falling below production costs, the income gains for consumers will be smaller than the costs to producers and falling oil prices become a negative-sum game," it said.
> 
> For 2016, the bank said it was "no longer looking for an acceleration in 2016 GDP growth" and that the risk of a global recession was now 30 percent.  Following a 70 percent price rout between mid-2014 and early 2016, oil markets are in flux.  Many analysts expect a modest price recovery, while others see another slump.  The International Energy Agency (IEA) on Friday said that oil prices had bottomed out due to U.S. and other output cuts outside the Middle East-dominated Organization of the Petroleum Exporting Countries (OPEC).
> 
> 
> 
> 
> 
> A female employee fills the tank of a car at a petrol station in Cairo, Egypt​
> The U.S. rig count fell for a 12th straight week last week to a total of 386, its lowest since December 2009 as drillers continue to slash capital expenditure.  Others, like Goldman Sachs, warn that ongoing global overproduction, which continues to see over 1 million barrels of crude produced in excess of demand every day, will pull prices back down again.  So far, demand in core markets like China remains strong.  China's January-February refinery throughput rose 4.6 percent compared to the same period a year earlier to 87.08 million tonnes (10.59 million barrels per day), official data showed on Saturday.
> 
> The data release came shortly after China reported record daily crude imports of 8 million barrels per day.  In traded markets, sentiment leans towards higher prices, with the amount of managed short positions open for U.S. crude, which would profit from falling prices, down over 40 percent since mid-February, while the amount of trades betting on price increases stands near record highs.  "The shift in sentiment in commodity markets continues to gather strength ... The worst may be over for commodity markets," ANZ bank said.
> 
> Oil prices stable as market seen bottoming, but oversupply lingers


----------



## waltky

Oil price dips as Iran rejects cap deal...

*Oil price falls as Iran rejects output freeze deal*
_Mon, 14 Mar 2016 - Oil prices fall by nearly 3% after Iran puts off plans to join nations proposing a freeze on production._


> Oil minister Bijan Zanganeh said Iran would only join discussions to cap output after its production reached four million barrels per day.  In February, Saudi Arabia struck a deal with Russia and other Opec nations to freeze oil output at January levels.  But Iran wants production to hit pre-sanction levels before beginning talks.  At the weekend, Mr Zanganeh said: "I have already announced my view regarding the oil freeze and I'm saying now that as long as we have not reached four million in production, they should leave us alone.  "When we reach this level of production, we can then co-operate with them."  In its monthly oil market report published on Monday, Opec said Iran produced 3.1 million barrels per day in February, a rise of 187,000 barrels on the previous month.
> 
> Surplus woes
> 
> Brent crude prices fell 2.7% to $39.32. Oil recently rose above $40 per barrel for the first time this year.  Prices have sunk nearly 70% since reaching a $115 a barrel in June 2014.  However, Opec, the cartel of oil-producing nations, has refused to cut make significant cuts to output amid a slowdown in demand from large industrial countries such as China, coupled with the shale energy boom in the US.  In its most recent report, Opec said its output slowed marginally in February, by 175,000 barrels per day to 32.38 million, on lower production from Iraq, Nigeria and the United Arab Emirates.  Overall, it expects demand for 2016 to reach 31.5 million barrels per day, a fall of 100,000 barrels on its previous forecast, but a rise of 1.8 million barrels per day on last year.
> 
> Bjarne Schieldrop, chief commodities analyst at SEB Markets in Oslo, said a two million barrel-per-day surplus in oil supplies would continue to weigh on prices in the short term. "We are likely to see $35 a barrel before we see $45 a barrel," he said.  Russia's energy minister, Alexander Novak, who met Mr Zanganeh in Tehran on Monday to discuss a separate oil and gas swap deal, was quoted as saying "Major oil producers shall co-ordinate with each other.  "However, since Iran's production decreased under sanctions, we totally understand Iran's position to increase production and revive its share in the global markets."
> 
> Oil price falls as Iran rejects output freeze deal - BBC News



See also:

*Oil falls as worry over growing stockpile cuts short rally*
_Mon Mar 14, 2016 - Oil prices fell about 3 percent on Monday on concerns that a six-week market recovery has gone beyond fundamentals as U.S. crude stockpiles continue to build and Iran maintains little interest in joining major producers in freezing production._


> Crude inventories across the United States likely hit record highs for a fifth straight week last week, rising 3.3 million barrels, a Reuters poll of analysts said. [EIA/S]  Stockpiles at the Cushing, Oklahoma grew almost 850,000 barrels to 69.6 million in the week to March 11, bringing storage at the delivery hub for U.S. crude futures to near capacity, traders said, citing market intelligence firm Genscape.  The Organization of the Petroleum Exporting Countries, meanwhile, said global demand for crude from its members, including Saudi Arabia and Iran, will be less than previously thought in 2016 due to competing non-OPEC supply. OPEC supply will likely exceed demand by about 760,000 barrels per day, up from 720,000 bpd it implied earlier.
> 
> Russia said OPEC's meeting with other key oil producers on an output freeze will probably be held in Doha in next month. It said Iran supports the plan, while Tehran says it wants to double its crude exports to 4 million bpd first.  "All the data out there is suggesting higher supply and lesser demand for oil, and that could only mean lower prices," said Phillip Streible, market strategist at RJO Futures in Chicago.  U.S. crude futures CLc1 settled down $1.32, or 3.4 percent, at $37.18 a barrel, while Brent LCOc1 finished down 86 cents, or 2 percent, at $39.53.
> 
> Monday's price slide came after last week's rally of 7 percent in U.S. crude, which was up for a fourth straight week. Brent gained 4 percent last week, up for a third week in a row.  Investment bank Morgan Stanley predicted a $25-$45 trading range for U.S. crude in an oversupplied but volatile market, concurring with several analysts' views.  "From a longer-term perspective over the coming four to six weeks, we still anticipate an ultimate crude price decline to the $26-28 area," said Jim Ritterbusch at Chicago energy consultancy Ritterbusch & Associates.
> 
> Money managers, including hedge funds, raised their bullish bets on U.S. crude for a third week in a row to November highs last week, but cut net long positions in Brent.  "I think we are back to inventory watching and the pressure will start moving to the bulls' positioning as the market will likely have little patience with large net (stockpile) builds," said Scott Shelton, broker with ICAP in Durham, North Carolina.
> 
> Oil falls as worry over growing stockpile cuts short rally


----------



## waltky

Oil prices bouncin' `round the $36-$39/bbl. range...

*Global stocks dip, dollar on tenterhooks for Fed; oil bounces*
_Wed Mar 16, 2016 - Asian shares were mostly lower on Wednesday while the dollar dithered as markets waited anxiously for the Federal Reserve to provide guidance on the risk of U.S. rate hikes this year._


> =snip=
> 
> Oil prices did manage a bounce after data from industry group American Petroleum Institute (API) showed U.S. crude stockpiles rose by less than half what analysts expected.
> 
> U.S. crude CLc1 gained 49 cents to $36.33 a barrel, while Brent LCOc1 rose 40 cents to $39.14. [O/R]
> 
> MORE


----------



## waltky

Granny says dey not tellin' us we runnin' outta oil again an' purt soon we all gonna be ridin' horses an' chariots again...

*Oil at 2016 high, U.S. crude above $40 on output freeze hopes*
_17 Mar.`16  - Oil prices hit 2016 highs on Thursday, with U.S. crude surging 5 percent to pierce the $40 barrier, on optimism that major producers will strike an output freeze deal next month amid rising crude exports and gasoline demand in the United States._


> A weaker dollar <.DXY> after a Federal Reserve policy decision on Wednesday that indicated two U.S. rate hikes this year instead of four also drew oil buyers using currencies such as the euro <EUR=>. [FRX]  OPEC kingpin Saudi Arabia and non-OPEC producers led by Russia will meet on April 17 in the Qatar capital Doha, aiming for the first global supply deal in 15 years.  "The remote possibility that a coordinated supply control effort comes from this meeting, assuming it even happens, has put market bears on the defensive," said Pete Donovan, broker with Liquidity Energy in New York.  Oil prices have surged more than 50 percent from 12-year lows since the Organization of the Petroleum Exporting Countries floated the idea of a production freeze, boosting Brent up from around $27 a barrel and U.S. crude from around $26.
> 
> On Thursday, the front-month in U.S. crude's West Texas Intermediate (WTI) futures <CLc1> settled up $1.74, or 4.5 percent, at $40.20, after scaling a 2016 high of $40.26.  Brent crude's front-month <LCOc1> finished up $1.21 at $41.54, after earlier reaching the year's peak of $41.60.  "For now, the market is staying well supported," said Olivier Jakob, oil analyst at Petromatrix. "It will be difficult to return to the lows of the year."  WTI also hit a premium against Brent <CL-LCO1=R> in intraday trading, the first time since January, as traders piled into the U.S. crude market on bets of an uptick in domestic oil exports.
> 
> Venezuela's state-run PDVSA bought two more cargoes of WTI this month after becoming Latin America's first importer of U.S. oil since January after an export ban was lifted.  "We're seeing increasing export activity in the U.S. Gulf, with over 2-1/2 million barrels currently loaded on tankers, ready to depart, and there's potentially more," said Matt Smith who tracks crude loadings for New York-headquartered Clipperdata.  U.S. crude has also gained traction on smaller stockpile builds of late, and surging gasoline consumption.  U.S. crude inventories last week climbed to its fifth straight week of record highs but by just 1.3 million barrels, a much smaller build than forecast, government data showed. Gasoline demand rose 6.4 percent over the past four weeks from a year ago.
> 
> Oil at 2016 high, U.S. crude above $40 on output freeze hopes


----------



## william the wie

If it stays this high for 10 days straight the oil supply will go up. The next running of the stops could send prices even higher as the shorts are forced to cover.


----------



## waltky

Oil prices still on the down side...

*Crude prices fall from 2016 highs as U.S. oil rig count rises*
_Fri Mar 18, 2016 - Crude prices settled lower on Friday after the U.S oil rig count rose for the first time since December, renewing worries of a supply glut after an output freeze plan helped boost the market to 2016 highs and multi-week gains._


> U.S. energy firms this week added one oil rig after 12 weeks of cuts, according to data by industry firm Baker Hughes. The addition, coming after oil rigs had fallen by two-thirds over the past year to 2009 lows, showed crude drilling picking up again after a 50 percent price rally since February. [RIG/U] "The rig count and crude prices have a direct relationship for sure," said Pete Donovan, broker at Liquidity Energy in New York. Brent crude LCOc1 finished down 34 cents, or 0.8 percent, at $41.20 a barrel, having risen $1 earlier to a 2016 high of $42.54. U.S. crude CLc1 settled down 76 cents, or 1.9 percent, at $39.44, after also gaining $1 to a year high of $41.20.
> 
> Despite the retreat, oil posted multi-week gains, with Brent up for a fourth straight week and U.S. crude a fifth week in a row. Both benchmarks rose about 2 percent this week. Global oversupply in oil had knocked crude prices down from mid-2014 highs above $100 a barrel to 12-year lows earlier this year, bringing Brent to around $27 and U.S. crude to about $26. Over the past two months, prices rallied to reach above $40 after the Organization of the Petroleum Exporting Countries (OPEC) floated the idea of a production freeze at January's highs.
> 
> The combination of declining oil output, smaller crude stockpile builds and surging gasoline consumption in the United States also helped the recovery, although some analysts said the rally had been overdone. "The market is probably too long here and needs a correction," said Scott Shelton, energy futures broker with ICAP in Durham, North Carolina. Some traders who had been bearish oil and lost money recently were eyeing fresh bets to price crude lower. "I think this rally will stall," said Tariq Zahir, who profited mostly over the last year on bets that U.S. crude for nearby delivery will fall against longer-dated contracts. "I took off several shorts and booked losses but on the first sign of weakness, I'm jumping back in."
> 
> Crude prices fall from 2016 highs as U.S. oil rig count rises



See also:

*Shares on best run in two years as dollar steadies*
_18 Mar.`16 - World equity markets were poised for a fifth week of gains on Friday, their best run in more than two years, as a 2016 high for oil, the dollar's recent decline and a more optimistic view of the economy combined to boost investor confidence._


> =snip=
> Oil rose above $42 a barrel, hitting its highest this year and extending a rally into a fourth week, on expectations of a production freeze by major exporters, stronger seasonal demand and dollar weakness.
> 
> Brent crude's front-month contract was up 64 cents, or 1.5 percent, at $42.18 a barrel after touching a 2016 high of $42.54. U.S. crude gained 52 cents to $40.72 a barrel.
> 
> Oil prices have surged by more than 50 percent from 12-year lows hit in December after the Organization of the Petroleum Exporting Countries (OPEC) toyed with a production freeze that lifted Brent from about $27.
> 
> MORE



Related:

*In oil price plunge, North Sea industry faces perfect storm*
_Mar 18,`16 -- It's Thursday night and the Spider's Web pub is packed with beefy guys in windproof jackets and massive backpacks. The exhausted oil rig workers pile their bags against the wall, play pool or just slump in the leather seats, knocking back pints of beer._


> But despite the drink, there's not much laughter. It's not work that bothers them, but the prospect that the work will end. "I'm worried," says Fraser Jamieson, an engineer who has spent the past 20 years on North Sea oil rigs. "We're all worried." The North Sea oil industry, the biggest and oldest in Europe, is struggling with a toxic combination of aging, drying wells and the recent plunge in oil prices, which is forcing companies to rethink investments and putting thousands of jobs at risk. Estimates suggest more than a third of some 330 oil fields in the U.K. North Sea will close in the next five years. "There is a sort of perfect storm," said Dorrik Stow, director of the Institute of Petroleum Engineering at Heriot-Watt University in Edinburgh, Scotland. "Those cumulative factors are going to negatively impact on the North Sea unless there is a fairly significant upsurge in the price of oil."
> 
> Brent crude, the benchmark for international oil, hit a 12-year low of $27.10 a barrel in January amid slowing economic growth in China and increased production in the U.S. That's down from more than $100 a barrel as recently as September 2014. While prices have recovered somewhat, Brent traded for about $42 on Friday and most experts don't expect a significant rebound soon. Low prices are causing turmoil internationally in an industry that has been going through booms and busts ever since 1859, when the first drilling rig was built in Titusville, Pennsylvania. For the North Sea, each new bust accelerates its downward spiral, hurting the countries that tap it - Britain, Norway and to a lesser extent the Netherlands.
> 
> Norway on Thursday slashed interest rates in a bid to help the economy manage the oil sector's drop. In Britain, the government this week offered tax relief to oil companies to protect jobs and stem a decline in government income. Tax revenue from the industry dropped to 2.1 billion pounds ($3 billion) last year from 10.9 billion pounds in 2011-12. Some of the biggest platforms are being dismantled as the industry forecasts production will drop to 45 million tons of oil equivalent this year, less than a third of the 150 million tons produced in 1999. Shell, for example, has started the process of decommissioning the Brent oilfield - which has produced 3 billion barrels of oil equivalent since 1976 and gave its name to the international crude oil benchmark.
> 
> Oil companies are expected to invest about 1 billion pounds ($1.4 billion) in new projects this year, compared with a recent average of 8 billion pounds, industry association Oil & Gas U.K. says. And it is hitting workers hard. Some 5,500 people have lost their jobs, or 15 percent of the 36,600 directly employed in the industry at the end of 2013, according to Oil & Gas U.K. The group estimates that total direct and indirect employment supported by the industry has fallen to 375,000 from a peak of 440,000. If the oil price remains around $30 a barrel for the rest of 2016, almost half of the North Sea fields "are likely to be operating at a loss, deterring further exploration and capital investment," according to Oil & Gas U.K. "2016 is going to be quite pivotal," said Fiona Legate, a research analyst at Wood MacKenzie. "We will see distress sales, and it will be make or break for a lot of companies."
> 
> MORE


----------



## waltky

Crude oil prices back up above $40/bbl...

*Oil futures dip as commodity rally gathers breath*
_Mon Mar 21, 2016 - Oil prices dipped in Asian trade on Tuesday, giving up gains from the previous session after data showed U.S. crude inventories fell for the first time since January and as commodity prices paused from their recent rally._


> U.S. crude futures for May LCOK6, the front month from Tuesday, were down 6 cents at $41.46 a barrel at 0245 GMT, after settling up 0.8 percent at $41.52 on Monday.  The previous front month settled at $39.91 before expiring on Monday.  Brent crude futures for May delivery LCOc1 were 12 cents lower at $41.42 a barrel after rising 0.8 percent on Monday. Brent has risen more than 50 percent from 12-year lows in January.  "The current risk-on environment remains conducive for commodity prices to consolidate after a strong rebound in the last six weeks," ANZ said in a morning note.  "However, a further improvement in fundamentals will be needed for bulks, crude oil and base metals to rally further."
> 
> Stockpiles at the Cushing, Oklahoma delivery hub for U.S. crude fell 570,574 barrels to 69.05 million in the week to March 18, traders said on Monday, citing data from market intelligence firm Genscape.  Cushing inventories had previously risen toward 70 million barrels, causing market participants to fear they could hit capacity.  Iran may join other oil producers planning to freeze production to support prices at a later date, OPEC's secretary general said on Monday, as the country is seeking to raise its exports after Western sanctions were lifted on Tehran in January.
> 
> Producers from the Organization of the Petroleum Exporting Countries and non-members are due to meet on April 17 in Qatar discuss the output freeze.  Iran is keen to increase its oil exports, which fell by more than half during the sanctions over Tehran's disputed nuclear program, and has said it should not be bound by a production freeze until it can recover its market share.
> 
> Oil futures dip as commodity rally gathers breath


----------



## waltky

Oil falls but still above $40/bbl...

*Oil futures fall after API stockpile build reasserts glut concerns*
_Wed Mar 23, 2016 - Oil prices fell on Wednesday after figures from an industry group showed U.S. crude stockpiles rose last week more than expected, reinforcing concerns that the global supply glut continues unabated._


> The front-month contract in U.S. crude futures was down 44 cents at $41.01 a barrel by 0628 GMT. It struck a 2016 high of $41.90 in the previous session before closing at $41.45. The contract has rebounded more than 50 percent since hitting its lowest level since 2003 in February.  Brent crude was 40 cents lower at $41.39, reversing gains in the previous session when it finished at $41.79.  Brent has also surged more than 50 percent since hitting a multi-year low in January of $27.10 a barrel.  "Net supply in the short-term should still be in excess and thus brings us to believe that the current uptrend is unsustainable," said Phillip Futures analyst Daniel Ang in a note on Wednesday.
> 
> The American Petroleum Institute (API), an industry group, said in a report after Tuesday's oil market settlement that U.S. crude stockpiles rose 8.8 million barrels last week to reach a record high of 531.8 million.  The stockpile growth reported by the API was 5.7 million barrels higher than estimates from analysts polled by Reuters. Official crude inventory data from the U.S. government will be released later on Wednesday.  The official U.S. data is likely to show that oil inventories rose to a record high for a sixth straight week, while oil product stockpiles probably fell, a Reuters survey showed.  "Near-term direction is likely to center on the degree of increase in U.S. stockpiles," ANZ bank said in a note on Wednesday.
> 
> Adding to the glut is the revival of Iranian barrels on the international market after sanctions were lifted in January.  Iran's crude oil exports have risen to 2.2 million barrels per day (bpd) since sanctions were lifted, an increase of 900,000 bpd, a senior official was quoted as saying on Tuesday.  "Until January we could only export 1.3 million barrels of oil but two months after the (lifting of) sanctions we are exporting 2.2 million barrels of oil per day," Vice President Eshaq Jahangiri was quoted as saying by the Shana agency.  Iranian flows may also increase as ship insurers have stepped in to plug a shortfall in cover for transporting Iranian oil resulting form the fact that U.S. reinsurers are still restrained by U.S. sanctions, according to officials involved in the initiative.
> 
> Oil futures fall after API stockpile build reasserts glut concerns



See also:

*In oil rout, some U.S. energy bosses were spared the pain*
_Wed Mar 23, 2016 - More cash, lower targets and bigger share awards - not all U.S. energy bosses are feeling the full impact of tumbling oil prices in their paychecks. Some oil and gas companies are making it easier for their top managers to meet performance goals or are offering more cash as a prolonged oil slump keeps share prices at lows not seen in five years, filings show._


> Among the beneficiaries are bosses of both solid performers and struggling companies, and the changes may rankle investors facing losses.  Oilfield services company Schlumberger NV, for example, used lower earnings targets for the second half of 2015, which helped its CEO Paal Kibsgaard receive total pay of $18.3 million, only slightly below the 2014 level. The company's shares fell 18 percent last year, about half the decline of its index and have since recovered about 7 percent.
> 
> Linn Energy , meanwhile, whose shares nosedived 87 percent last year under the weight of its swelling debt and dwindling financing options, announced a new incentive plan last month for its top executives that focuses more on cash rather than stock. Dallas-based oil and gas exploration company Exco Resources Inc will offer its directors restricted stock worth $140,000 a year – about 10 times the value of shares awarded in 2014, according to securities filings, even though its shares fell 43 percent last year.
> 
> In another example, Halcon Resources Corp - built by its CEO Floyd Wilson, who has made a fortune launching and selling off oil companies - disclosed in a securities filing last week that Wilson received $3 million and three other top executives $800,000 each in exchange for an agreement to stay for at least another year.
> 
> A representative for Halcon, which has hired financial and legal advisors to navigate the downturn, did not return messages.  Schlumberger declined to comment beyond its recent proxy statement. An Exco representative said the new plan makes its director pay more competitive and aligns their compensation with performance of the company.  A representative for Linn Energy told Reuters in February the compensation changes were designed to ensure management stayed on to secure the company's future. The company did not respond to requests for further comment. Offering executives financial incentives to stay through upheaval, be it a merger or restructuring, is a common practice.
> 
> ONE WAY BET?


----------



## waltky

US glut sends domestic oil prices downward...

*U.S. oil falls after big jump in stockpiles*
_Wed Mar 23, 2016 - U.S. oil prices fell in Asian trading on Thursday, adding to a slump in the previous session, after stockpiles rose for the sixth week to another record, sapping the strength of a two-month rally in prices._


> U.S. crude futures CLc1 were down 10 cents at $39.69 a barrel at 0302 GMT, trading further below the important $40 level.  It closed down $1.66, or 4 percent, at $39.79 a barrel on Wednesday. That marked the sharpest one-day drop for the front-month contract in U.S. crude since Feb. 11.  Brent crude futures LCOc1 were up 7 cents at $40.54 a barrel, after trading lower earlier in the session. They finished the last session down $1.32, or 3.2 percent, at $40.47 a barrel.  Earlier this week, both benchmarks had risen by more than 50 percent from multi-year lows that hit in January.
> 
> The U.S. government's Energy Information Administration (EIA) said crude stockpiles climbed by 9.4 million barrels last week - three times the 3.1 million barrels build forecast by analysts in a Reuters poll. <EIA/S>  The continued rise in stockpiles is grinding away at the gains in prices that were largely driven by plans of major producers, including Saudi Arabia and Russia, to freeze production.  "OPEC production is still high and Iran is expected to continue to ramp up," said Tony Nunan, oil risk manager at Mitsubishi Corp in Tokyo.  "I expect crude to come back down again and test the $35 level again if we continue to get builds," he said.
> 
> The market was also supported by a release showing crude stockpiles at the Cushing, Oklahoma, delivery hub - an important data point - fell for the first time in seven weeks. USOICC=ECI  Things could get worse for oil bulls, with trading houses betting on oil markets being over supplied for at least two more years and looking to extend or lock in new leases on storage tanks.
> 
> U.S. oil falls after big jump in stockpiles


----------



## waltky

Waitin' for the day when Dubai reverts to a Bedouin ghost town...

*Kuwaitis face cuts in lavish benefits as oil prices drop*
_24 March 2016 - Sitting on the world's sixth largest proven oil reserves, Kuwait's 1.3m citizens are accustomed to lavish benefits, such as interest-free housing loans, free education and healthcare, and food and fuel subsidies._


> But like other Gulf states, the sharp fall in global oil prices has forced the country to consider whether these benefits are luxuries it can no longer afford.  Last month, Parliament Speaker Marzouq al-Ghanim warned that continuing to spend in the same way would be "economic suicide".  "We cannot lie to the Kuwaiti people, we cannot come here and say we will protect your pockets and the citizen will not be affected," he said. "Everyone's pockets will be affected... This is the reality."
> 
> In January, the Emir Sheikh Sabah al-Sabah spoke of the need for better management of spending and for budget cuts to cope with declining revenues.  However, an attempt by the government to remove subsidies on diesel and kerosene last year was heavily criticised by MPs.  The pressure led to the subsidies being restored, although it was decided that they would be reviewed monthly in accordance with global price fluctuations.
> 
> 
> 
> 
> 
> The acting Finance Minister, Anas al-Saleh, also announced this month that the cabinet had approved a plan to impose a 10% tax on corporate profits, as one of a number of measures aimed at reducing Kuwait's budget deficit, projected to be 8.18bn dinars ($27.1bn; £19.2bn) for this financial year.  In addition, some state-owned projects, including airports, ports and some facilities of the Kuwait Petroleum Corporation (KPC), would be privatised, Mr Saleh said.
> 
> Kuwaiti lawyer Mishari al-Sawwagh feels that the government's priorities in implementing such measures are misplaced.  "Our problem in Kuwait is not about money... it's about leadership and management," he told the BBC.  Mr Sawwagh believes cutting subsidies will not only hit Kuwaiti citizens but also the 2.9 million-strong foreign workforce on which they depend.  "Lifting petrol subsidies, for example, will affect foreign workers who may consider leaving as they can no longer afford the living costs here, and this will also affect our economy," he said.
> 
> *'Medical tourism'*



See also:

*Oil Recovery Hits Saudi Devaluation Bet*
_Investors would have lost 1.8% since forwards' January peak; GCC pegs have survived 30 yrs of oil-price fluctuations: HSBC_


> Oil’s rebound to about $40 a barrel means some investors are nursing losses after betting that Saudi Arabia would abandon its three-decade-old currency peg.  Contracts used to speculate on the kingdom’s exchange rate in the next 12 months have fallen to about the lowest since November. A $1 million wager on the contracts at their peak in January would have lost 68,900 riyals ($18,370), or about 1.8 percent, according to Bloomberg calculations. Several U.S.-based hedge funds were said in February to be among investors that have bet Saudi Arabia would devalue the riyal.
> 
> The decreased speculation that Gulf nations will abandon their dollar pegs underscores how crude prices have recovered this year. Oil, Saudi Arabia’s main source of revenue, is headed for a second straight monthly gain. The Saudi riyal has been trading at a rate of 3.75 per dollar since 1986, and the kingdom has taken steps to make speculating against the currency harder.  “We have argued that those positioning for a devaluation were going to be disappointed,” said Simon Williams, the London-based chief economist for central and eastern Europe, the Middle East and North Africa at HSBC Holdings Plc. “The pegs have been in place for 30 years in times of high oil prices and low oil prices. I have no sense” that recent losses in crude are “going to change policy makers’ minds or force their hand,” he said.
> Gulf Peers
> 
> The percentage loss on the riyal forwards may actually be greater than 1.8 percent because derivatives trades tend to be leveraged, meaning that more is at stake than is actually wagered. Still, the cost of a bet on any devaluation is small relative to the windfall investors would stand to receive should it happen.  Twelve-month currency forward agreements have declined for other members of the Gulf Cooperation Council. Contracts for the United Arab Emirates’ dirham have dropped 65 percent since hitting a seven-year high in January, while those for the Omani rial have almost halved from a recent peak. Bahraini dinar and Qatari riyal forwards have also tumbled.
> 
> Saudi Arabia has dipped into its reserves and sold debt as oil revenue dropped. Foreign-currency holdings have tumbled every month but one since August 2014 to less than $600 billion in January, from about $737 billion.  The reserves of GCC members provide ample room to maintain pegged exchange rates for several years, even in an adverse scenario for oil prices, Moody’s Investors Service senior analyst Mathias Angonin said in Dubai last week. Changes to the current exchange-rate systems are unlikely because the costs associated with one-off devaluations would outweigh the benefits, he said.
> 
> MORE


----------



## william the wie

This is getting strange. KSA, Russia, Iran or somebody else talks Brent up above $40/bbl and away goes WTI covered by futures contracts to some refinery in Europe. Then OPEC complains that US inventories and rig count are going back up. Why can't they appreciate that Iran can't ship squat. No sense of gratitude.


----------



## waltky

Crude prices roller coaster ride...

*Oil prices rebound on less than expected build in stocks*
_Tue Mar 29, 2016 - Oil futures rebounded in Asian trade on Wednesday, buoyed by a forecast for a less than expected build in crude oil stockpiles last week._


> A weakening dollar also lent some support but concern that a two-month rally was fading in an oversupplied market put a ceiling on gains.  Brent futures LCOc1 climbed 40 cents to $39.54 a barrel as of 0104 GMT (09:04 a.m. EDT) after settling down $1.13 in the previous session.  U.S. crude CLc1 rose 45 cents to $38.73 a barrel after ending the previous session down $1.11.
> 
> Oil prices fell about 3 percent in the previous session after Kuwait and Saudi Arabia said they would resume production at the jointly operated 300,000-barrel-per-day Khafji field even as oil output is supposed to be capped.  "There's a little bit of steadying in oil prices in the Asian time zone. The predominant attitude is one of wait-and-see until the Energy Information Administration (inventory) figures come out," said Ric Spooner, chief market analyst at Sydney's CMC Markets.  The EIA is due to release official crude inventory data later on Wednesday.  U.S. crude stocks rose last week by 2.6 million barrels to 534.4 million barrels data from industry group, the American Petroleum Institute, showed on Tuesday.
> 
> That was less than analysts' expectations of a 3.3 million barrel build, but still a record high for a seventh straight week.  "The market is seeing how currencies go as well. It was slightly disconcerting for the market (on Tuesday) to see oil prices falling at the same time as the dollar was falling," Spooner said.  The dollar index .DXY nudged lower on Wednesday after slipping to an eight-day low in the previous session. A weaker dollar makes greenback-denominated commodities cheaper for holders of other currencies.
> 
> Rosneft, Russia's top oil producer, is set to lower oil output, Russian Natural Resources Minister Sergei Donskoi said on Tuesday, although he gave no time frame.  The plan could be lending support to oil prices, Spooner said, although the impact would be muted because the market is already pricing in possible output curbs.  OPEC member Iran is expected to attend an oil producers meeting in Doha on April 17 to discuss a cap on global oil production, although it may not take part in the discussions, a source familiar with Iranian thinking said on Tuesday.
> 
> Oil prices rebound on less than expected build in stocks


----------



## waltky

Oil prices fall on expected oversupply...

*Oil prices fall on dimming prospect of output restraint*
_Mon Apr 4, 2016 - Oil prices fell on Monday as the chances of Middle East producers agreeing to curb overproduction appeared to fade, while stubbornly high U.S. output and worries about Asia's economic outlook also dragged on prices._


> Iran, returning to global oil markets after sanctions against it were lifted in January, said it would continue increasing its oil production and exports until it reaches the market position it enjoyed before the imposition of sanctions, according to a media report.  This makes a proposed deal by major producers to restrict ballooning output unlikely as top exporter Saudi Arabia said last week it would only participate if its rival Iran also took part.
> 
> U.S. crude futures CLc1 were at $36.39 per barrel at 0554 GMT, down 1.06 percent or 40 cents from their last settlement, while Brent crude LCOc1 was down 0.9 percent or 34 cents at $38.33. A global glut has pulled down oil prices by as much as 70 percent since 2014.  "Macroeconomic concerns and high petroleum inventories are the oil market's ball and chain and are likely to keep the oil price between the mid-$30s and low $40s in Q2," Barclays said.  While some analysts expect a recent weakening of the U.S. dollar .DXY to spur demand for oil from importers holding other currencies, Morgan Stanley said "negative oil headlines, producer hedging at higher prices and bloated inventories" indicate any upside in prices will be limited.
> 
> Adding to concerns of a global glut is U.S. production remains high despite steep cuts in drilling for new reserves as well as a jump in bankruptcies.  "The U.S. oil rig count dropped further this week, with a total 10 rigs idled," Goldman Sachs said. "The current rig count implies U.S. production ... would decrease by 705,000 barrels per day yoy (year-on-year) on average in 2016, and by 375,000 barrels per day yoy in 2017," it added.  So far, U.S. production remains stubbornly high, at over 9 million barrels per day.
> 
> Despite a pick-up in recent economic data, including from India and China, analysts also poured cold water on hopes that Asia's economic prospects were improving.  "Asia continues to face a structural growth problem – one that will not be cured in the space of a few, short months," said HSBC's Frederic Neumann.  Given a growing belief that prices might not recover by much any time soon, hedge funds have cut their net long positions in U.S. crude for the first time in six weeks.  The chief executive of the Abu Dhabi National Oil Company said oil markets would only start to rebalance in 2016 and 2017.
> 
> Oil prices fall on dimming prospect of output restraint


----------



## waltky

Iran doesn't get it's way...

*The OPEC-Russia Freeze Is Already Dead*
_Apr. 4, 2016 - Summary

OPEC - Russia deal was already poised to fail.

The deal saw all parties freeze production at (or near) record levels -- not closing the supply - demand gap.

Saudi Arabia announced they will not freeze if Iran does not freeze production (which is very unlikely).

Russia keeps increasing production levels (and exports) as well._


> Oil prices formed a low and rallied when a plan between Russia and several OPEC members was announced, which saw each country limit its production levels to the output seen this January. I believe this deal wasn't very effectual in the first place, but with the most recent data we see that it will likely not propel oil prices higher unless major changes are made to this plan.  The plan originally saw OPEC members as well as Russia freeze their output at the production levels they reported for January 2016 -- this would have been not very efficient in propping oil prices up, as OPEC as well as Russia produced oil at a very high rate in January. Freezing production at (or near) record levels is not a great idea if your goal is reducing production to balance the supply and demand gap.
> 
> 
> 
> 
> In this chart we see that OPEC production was very close to its record high in January 2016, up 130,000 barrels a day from the December level, up 500,000 barrels a day from the 2015 average and up 1.5 million barrels a day from the 2014 average. Since the global supply and demand imbalance stands at 1.5 million to 2.0 million barrels of oil each day, freezing production just 80,000 barrels below last year's peak production number (reported for November) is not the appropriate way to balance this gap. On the other side of the deal we had Russia, which reported record production in January as well: The country produced 10.88 million barrels a day in January, which was a post Soviet record for the country, thus positioning the country to freeze production at record levels (once again, not the right move if your goal is to balance a huge overproduction issue).
> 
> The deal was already proposed to fail, but recent news will mean the chance of a beneficial impact on the global supply - demand gap will be even lower:  On Friday Saudi Arabian official (and deputy crown prince) Mohammed bin Salman announced that Saudi Arabia would only participate in a production freeze if all other OPEC countries, including Iran, as well as non-OPEC members such as Russia would freeze production as well. As we know Iran is not looking towards freezing production any time soon, as the country desperately seeks to expand oil production after sanctions have been lifted a couple of months ago. The EIA forecasts that Iranian oil production will average 3.1 million barrels of oil in 2016, and 3.6 million barrels of oil in 2017.
> 
> 
> 
> 
> This would represent a huge increase of almost thirty percent over 2015's production level of 2.8 million barrels a day. Iran thus does want to freeze production at the current level at all, which ultimately means that Saudi Arabia will not want to freeze production either (according to the Prince's words).  As if this wasn't already bad enough, Russia -- the other major country in the deal -- does not seem to be willing to freeze production either. In March the country's production hit 10.912 million barrels a day, which was an increase of two percent in comparison to the prior year. This production level also was higher than the one in January, which (according to the production freeze deal) should have been the absolute limit. Apparently Russia is not seeing any benefit in following the plan which was already poised to fail (as, even when every country agreed to freeze production at the January level, the supply - demand gap would not have closed), and with Saudi Arabia's announcement that they will not participate if Iran does not freeze its production (which is very unlikely), it seems the two biggest producers of the proposed production freeze are both not willing to actually act on it.
> 
> Due to lower consumption in the country, Russian oil exports rose by ten percent yoy (to 5.6 million barrels a day) in March, which means pressure on global oil prices will be even higher, as the country is selling a growing amount of its production on the global market (instead of consuming oil in the country).  In April OPEC members and Russia will once again come together to discuss coordinated moves towards production freezes (or production cuts), but if we use past meetings and agreements as a guideline, we can assume that the efforts will not be very fruitful. If those countries would agree on a production cut by five percent, and every member would actually do so, the global supply - demand gap would be closed and oil prices could rally substantially, but I believe such an agreement is rather unlikely.
> 
> *Takeaway*



See also:

*Asian shares slide; frazzled by Fed, falling oil prices*
_Tue Apr 5, 2016 - Asian shares and other riskier assets skidded on Tuesday, pressured by slumping crude oil prices and mixed messages from Federal Reserve policymakers on the outlook for U.S. interest rate rises._


> Oil prices continued to drop after shedding more than 2 percent overnight, as investors doubted that oil producing countries would freeze output to address a global glut.  Brent lost 0.4 percent to $37.54 a barrel after losing 2.5 percent on Monday. U.S. crude lost nearly 3 percent overnight, and on Tuesday was down about 0.5 percent at $35.53.  European shares are seen falling, with spread-betters expecting Germany's DAX to fall as much as 1.0 percent and Britain's FTSE 0.5 percent.
> 
> MSCI's broadest index of Asia-Pacific shares outside Japan was down 1.3 percent. Japan's Nikkei stock index dropped 2.4 percent to an eight-week closing low, as the perceived safe-haven yen rallied.  "Investors are concerned that Japanese companies are losing their 'weak-yen appeal'," said Kazuhiro Takahashi, equity strategist at Daiwa Securities.  "Many people are thinking it would be difficult for exporters to forecast on-year gains in their earnings for this fiscal year."
> 
> Commodity-related and industrial shares helped drag down U.S. stock indexes overnight, and U.S. economic data suggested that economic growth remained sluggish in the first quarter.  New orders for manufactured goods dropped in February, as they have in 14 of the past 19 months, while business spending on capital goods was much weaker than initially believed.  That gave investors no reason to believe the U.S. Federal Reserve would raise interest rates anytime soon, in line with the cautious tone Fed chair Janet Yellen sounded last week that contrasted with more hawkish remarks from other Fed policymakers.
> 
> Boston Federal Reserve President Eric Rosengren was the latest to fly into the hawkish zone on Monday, calling it "surprising" that futures markets currently price in just one or even no rate hikes this year, which he said could prove "too pessimistic."  "Rosengren is usually on the dovish side of the spectrum, highlighting how out of line Fed chair Yellen sounded last week compared to her colleagues," Sean Callow, senior currency strategist at Westpac, said in a note.
> 
> MORE


----------



## waltky

Oil prices rises in spite of oversupply...

*Oil rises on firm U.S., German growth but traders warn of ongoing glut*
_Fri Apr 8, 2016 - Oil prices rose on Friday, lifted by firm economic indicators from the United States and Germany which could support fuel demand, but analysts warned that crude markets were threatened by another downturn because of ongoing oversupply._


> Front month U.S. West Texas Intermediate (WTI) crude futures were trading at $38.02 per barrel at 0653 GMT, up 76 cents, or 2 percent, from their last close. International Brent futures were up 60 cents at $40.03 a barrel.  "We believe the current oil price is unsustainable and expect a fundamental price recovery when markets move into better balance in mid- to late-2H16," investment bank Jefferies said on Friday, although it added that "the recovery could be protracted."  Traders said there was some bullish sentiment in oil markets early on Friday following statements by the U.S. Federal Reserve that the world's biggest economy was on the path of more economic growth.
> 
> In Europe, rating agency Moody's said that Germany - the continent's biggest economy - expected a slight acceleration of its growth to 1.8 percent, benefiting from robust domestic demand.  Despite encouraging reports from two of the world's biggest economies, analysts warned that oil prices could fall again soon as there were few signs that a global overhang in production of at least 1 million barrels per day (bpd) would be addressed soon.  "Investors are lacking confidence about improved U.S. seasonal demand, as a decline in U.S. crude stockpiles (reported earlier this week) was mainly attributable to weaker imports and improved refinery utilisation," ANZ bank said.
> 
> Outside the United States and especially in parts of the Middle East, production is still soaring.  Iraq said on Thursday that exports from its southern ports had hit almost 3.5 million bpd by April, up from an average of 3.29 million bpd in March, putting doubts on the feasibility of a planned meeting by major producers on April 17 to freeze output levels.
> 
> Iran, which was relieved from crippling international sanctions in January which had cut its crude exports to little more than 1 million bpd, has said it would only participate in a production freeze once it had regained its pre-sanctions levels of 4 million bpd, pouring cold water on any hopes that ballooning oversupply can be reined in soon.  ANZ bank said that there were signs that a renewed downtrend could be imminent for crude oil prices.
> 
> Oil rises on firm U.S., German growth but traders warn of ongoing glut


----------



## william the wie

What is strange is that the range of break even points for fracking is much wider than was thought. It also look like economies of scope from Well logs are much higher than expected.


----------



## longknife

Saw a story this morning where a huge amount of massive oil tankers are moored off the port of Basra, Iraq. It's pumping oil and shipping it out as fast as it can.

Why?


----------



## william the wie

Yep and oil fields will sell for effectively nothing.


----------



## waltky

longknife wrote: _
Saw a story this morning where a huge amount of massive oil tankers are moored off the port of Basra, Iraq. It's pumping oil and shipping it out as fast as it can.

Why?_

To pay for the war with ISIS.


----------



## longknife

waltky said:


> longknife wrote:
> _Saw a story this morning where a huge amount of massive oil tankers are moored off the port of Basra, Iraq. It's pumping oil and shipping it out as fast as it can.
> 
> Why?_
> 
> To pay for the war with ISIS.



But, from what I read, they're just parked there.






With story - 
*Shocking Photo: Nearly 30 Oil Tankers in Traffic Jam Off Iraqi Coast* @ Shocking Photo: Nearly 30 Oil Tankers in Traffic Jam Off Iraqi Coast | Zero Hedge


----------



## william the wie

waltky said:


> longknife wrote:
> _Saw a story this morning where a huge amount of massive oil tankers are moored off the port of Basra, Iraq. It's pumping oil and shipping it out as fast as it can.
> 
> Why?_
> 
> To pay for the war with ISIS.



Also to rebuild infrastructure. $100B in Iran and Iraq is making payment on similar work in their own country.


----------



## waltky

Africa's largest oil producer is short of petrol...

*Nigeria fuel crisis: Why is Africa's largest oil producer short of petrol?*
_Thu, 07 Apr 2016 - Despite being one of the world's biggest oil producers, the BBC's Martin Patience explains why Nigeria is currently facing a severe shortage of fuel._


> It does not have enough oil refineries and even if the four it has were running at full capacity, they would only supply a quarter of the country's needs, says John Ashbourne, an economist at the financial research firm Capital Economics.  To meet demands, the national oil company imports around 50% of its fuel needs. The remainder is then supposed to be imported by private fuel distributors.  But for months these companies have been reducing their imports leading to the current fuel shortages.  The BBC's Nigeria correspondent Martin Patience looks at three reasons why:
> 
> 1) Outstanding debts
> 
> For years, the Nigerian government paid a fuel subsidy to make it cheaper at the pump. But it was hugely expensive when the price of oil was high.  The current government, which came to power last May, said it inherited massive debts from the previous administration.  Fuel distributors were initially left out of pocket. Finally, the government paid the bill in November. But by that time, companies had already started slowing fuel imports.
> 
> 2) Currency crisis
> 
> The slump in global oil prices is hammering the Nigerian economy.  It has led to a shortage of the US dollars needed to pay for imports.  With the country facing a currency crisis, the distributors are struggling to get their hands on dollars to pay for fuel imports.  They say they are being forced to use the black market where they pay a far higher rate.
> 
> 3) Fuel subsidy dispute
> 
> In January, the government ended official fuel subsides saying the cost of oil had fallen so much that they were no longer required.  But the fuel distributors disagree.  In protest, some companies stopped selling fuel during this dispute.  As the shortages increased, others hiked their prices above the official government rate - leading to accusations of profiteering.  Some analysts predict that until the fuel subsidy is reintroduced or official retail rates are allowed to rise, distributors will continue to limit the supply.  And for Nigerian motorists that could mean the long wait at the pumps will go on.
> 
> Nigeria fuel crisis: Why is Africa's largest oil producer short of petrol? - BBC News


----------



## william the wie

Refinery capacity is low worldwide. Construction and maintenance budgets are based on $80-100/BBL


----------



## waltky

Oil falls ahead of producer meeting...

*Oil falls as dark clouds appear ahead of producer meeting*
_Wed Apr 13, 2016 - Oil prices fell on Thursday as OPEC warned of slowing demand and Russia hinted that there would only be a loose agreement with little commitments at the upcoming exporter meeting to rein in ballooning oversupply._


> Meanwhile, Goldman Sachs said that productivity gains by U.S. shale producers were keeping alive its "deflationary outlook" for oil prices as drillers manage to adjust to lower prices instead of going out of business.  Brent crude futures LCOc1 were at $43.66 a barrel at 0123 GMT, half a dollar, or 1 percent, below their last close.  U.S. West Texas Intermediate (WTI) futures CLc1 were also down 1 percent at $41.60.
> 
> Russian oil minister Alexander Novak told a briefing that a deal on an output freeze scheduled this weekend will be loosely-framed with few detailed commitments.  "The agreement will not be very rigidly formulated, it is more of a gentlemen's agreement," one of those present said, paraphrasing Novak's words at the gathering.  A second person present said: "there is no plan to sign binding documents."  This would make it unlikely that the meeting by top exporters in Qatar on Sunday will successfully rein in production of around 2 million barrels per day (bpd) of crude in excess of demand.
> 
> Morgan Stanley said in a note that "we think any agreement actually sets up bearish catalysts for the months ahead."  With the likelihood of a binding freeze by the Organization of the Petroleum Exporting Countries (OPEC) and Russia fading, analysts will look to the U.S. oil industry to see if lower drilling will result in falling production.  Here too, the outlook is for production to remain higher than many expected.  "Shale productivity gains remain a key driver of our long-term deflationary outlook for oil prices," said Goldman Sachs.[  "Our analysis of shale productivity... (is) broadly in line with our expectations for 3 percent to 10 percent yoy (year-on-year) increases," it added.  With no end in sight to the supply glut, much will depend on demand to determine the size of the market's oversupply.
> 
> While demand has been strong, supported largely from Asia, OPEC on Wednesday cut its 2016 forecast for global demand growth and warned of further reductions.  World demand will grow by 1.20 million bpd in 2016, OPEC said in its monthly report, 50,000 bpd less than expected previously.  "Economic developments in Latin America and China are of concern... Current negative factors seem to outweigh positive ones and possibly imply downward revisions in oil demand growth."  Morgan Stanley pointed to several bearish risks for oil, including "significant selling pressure from producer hedging if prices rise... (and) reemerging macro headwinds."  The bank said it was "bearish oil prices into 2H16" and that "sustaining a price above $45 WTI in the front will be difficult... into 2017."
> 
> Oil falls as dark clouds appear ahead of producer meeting


----------



## waltky

Oil futures up ahead of OPEC meeting...

*Crude prices edge up in thin trading ahead of producer meeting*
_Thu Apr 14, 2016 - Crude futures edged up on Friday in thin business as traders were reluctant to take on new positions ahead of a planned meeting at the weekend of major oil exporters who want to rein in ballooning global over-production._


> A group of oil producers, lead by top exporters Saudi Arabia and Russia, plan to meet in Qatar's capital Doha on Sunday to discuss measures to freeze output around current levels in an effort to contain a global supply glut that is seeing some 2 million barrels of crude produced every day in excess of demand.  Traders said they were reluctant to take on new positions ahead of the meeting, which takes place outside of market hours, and that as a result of low volumes, prices were little moved.  "The crude oil market is awaiting the outcome from a key meeting of oil producers in the coming days," ANZ bank said.
> 
> Brent crude futures LCOc1 were at $44 a barrel at 0154 GMT, 16 cents, or 0.4 percent above their last close.  U.S. West Texas Intermediate (WTI) futures CLc1 were up 17 cents at $41.67.  With discussions focussing around freezing output at or near current record levels, most analysts said they have little hope that a potential Doha deal will reduce the glut that has pulled down crude prices by as much as 70 percent since 2014.  "The Doha meeting does not materially change the oil market balances," Barclays bank said.
> 
> Instead of pushing prices up by much, Barclays said an agreement could prevent prices from otherwise falling further.  "If recent supply-side fundamental support holds and the market's expectations for a credible statement and commitment are met, the meeting could help prevent prices from falling back to the low $30 range."  Energy consultancy Wood Mackenzie said that "even if an output freeze is announced, we do not expect a genuine one to occur during the remainder of 2016."  Instead, Wood Mackenzie said it expected "OPEC output to rise 0.5 million barrels per day year-on-year in 2016, with most of that growth coming from Iran and Iraq, both of whom have indicated plans to grow output in 2016."
> 
> Crude prices edge up in thin trading ahead of producer meeting


----------



## waltky

Output freeze to push up oil prices...

*Oil exporters to discuss output freeze*
_Fri, 15 Apr 2016 - Opec members, together with a few other oil producers, are meeting in Qatar on Sunday to discuss freezing output in an attempt to push up oil prices._


> The world's leading oil exporters could be finally about to take action following the fall in prices.  Members of the exporters' group Opec, together with some other oil producers, are meeting in Qatar on Sunday to discuss freezing output.  They want to push up the price of crude oil, which is less than half what it was in June 2014.  In previous episodes of falling prices, Opec has been much quicker to respond, often cutting output.  The agenda for the meeting in Doha, the capital of Qatar, is a freeze in production. No cuts in other words, just a commitment to no more increases.  But even that possibility has given some support in recent weeks to the price of oil. The low it reached earlier this year was about $27 a barrel for Brent crude oil, one of the leading international market prices.  This week it has been very close to $45. That is to a large extent due to traders considering the possibility that some oil producers are close to taking some sort of action to push prices higher.
> 
> It's worth emphasising that even at current levels the price of oil is far below where it was as recently as June 2014 - when it reached $115.  The fall has hurt many oil producing countries. Earlier this week, the International Monetary Fund said it had damaged financial stability and the government finances in many of them.  The meeting is not formally an Opec event, though all or very nearly all the group's members will be represented. There will also be some non-members, notably Russia.  The decision to hold this meeting, with a rather unusual group of attendees, reflects the oil exporters' persistent concerns about the level of prices and a feeling that any action needs to involve more than just the members of Opec.
> 
> Two of the world's leading producers are not going to be there: the US and China. Both countries have large oil production industries, but they use nearly all of it themselves, and have to import extra to meet their own needs. Their economies overall tend to benefit from cheaper oil so they don't have a shared interest with those who will be turning up in Doha.  Still, there is more than enough oil production that will be represented there to make a substantial difference to the global market if the participants chose to take strong action.  What many oil analysts say, however, is that they aren't talking about action that is going to achieve much. In the past, Opec has often managed to agree and deliver cuts in production. This time all that's on the table is a potential agreement to refrain from further increases.
> 
> Among the countries attending there is certainly a good deal of support for the idea. But one important player, an Opec member, is determined to increase its production: Iran.  As the country emerges from western sanctions, the Iranian government wants to regain the share of the market that it lost as a result of those restrictions on its international sales.  Iran is not even sending its oil minister Bijan Zanganeh to the meeting, although another senior official is expected to attend.  Saudi Arabia's Deputy Crown Prince has said that a freeze could only happen if Iran takes part. But there are doubts about whether this really is the Kingdom's last word.
> 
> *No 'game changer'*



See also:

*Oil down ahead of producer meeting; dollar slips*
_April 15, 2016  - Crude oil prices fell on Friday ahead of a weekend meeting that could yield an output freeze by major producers, while the U.S. dollar and stocks across the globe edged lower but posted weekly gains._


> On Wall Street, energy stocks led the market slightly lower as oil fell, and Apple <AAPL.O> shares also weighed after Nikkei business daily reported Apple will continue its reduced production of iPhones in light of sluggish sales.  The S&P 500, however, posted its seventh positive week in the last nine.  The MSCI index of stocks across the globe <.MIWD00000PUS> hit its highest point of the year on Thursday and emerging market stocks <.MSCIEF> racked up their best weekly gain in six. European shares <.FTEU3> fell 0.3 percent but posted their largest weekly gain in two months.
> 
> On Friday, the Dow Jones industrial average <.DJI> fell 28.97 points, or 0.16 percent, to 17,897.46, the S&P 500 <.SPX> lost 2.05 points, or 0.1 percent, to 2,080.73 and the Nasdaq Composite <.IXIC> dropped 7.67 points, or 0.16 percent, to 4,938.22.  Japan's Nikkei <.N225> closed 6.5 percent higher for the week.  China's economy grew 6.7 percent in the first quarter from a year earlier, meeting expectations and providing additional evidence that a slowdown in the world's second largest economy may be bottoming out.
> 
> The dollar index <.DXY> slipped 0.2 percent after the U.S. currency had gained more than 1 percent against both the yen <JPY=> and the euro <EUR=> earlier this week.  Speculation was still rife about whether top oil producers led by Saudi Arabia and Russia will be able to reach a deal in Qatar on Sunday to curb output.  "I think the fact that oil producers are talking suggests that the psychology of the market has changed a little bit and probably the worst of the oil price declines is behind us. This would be good for risk sentiment going forward," said Shaun Osborne, chief currency strategist at Scotiabank in Toronto.
> 
> MORE


----------



## william the wie

No agreement will be reached.


----------



## waltky

Granny says, "Dat's right - purt soon we all gonna be standin' in line buyin' $3/gal.  gas again...




*Doha oil producers close to agreeing output freeze: sources*
_Sun Apr 17, 2016 - Oil producing countries meeting in Doha on Sunday appeared close to agreeing on an output freeze to prop up crude prices, the first such deal in 15 years, official sources told Reuters.  A draft agreement circulating in Doha and seen by Reuters says countries' average daily crude oil production in each month would not exceed the level recorded in January this year._


> The freeze would last until Oct. 1 this year, and producers would meet again in October in Russia to review their progress in engineering "a progressive recovery of the oil market", the draft reads.  Final agreement has not been reached on the draft, but several senior sources in national oil ministries said they believed a deal could be achieved.  "I am optimistic," acting Kuwaiti oil minister Anas Khalid al-Saleh said on Saturday of prospects for a deal.  "‎There is only one proposal. Freeze at the January level till October," another delegate said, declining to be named because of political sensitivities. "There is a proposal to meet in October and to look forward."  "We have a deal," a third senior oil source told Reuters.
> 
> Over a dozen oil-producing countries inside and outside OPEC have officially confirmed they would attend the meeting in Doha - although major producer Iran has said it would not participate as it could not accept proposals to freeze its production.  During the freeze, producers would continue to consult on the best ways to bolster the oil market, and the deal would be open for other states to join, the draft agreement says.  The draft provides for the creation of a "high level monitoring committee" of two oil ministers from OPEC countries and two from non-OPEC countries; they would be assisted by a working group of experts.
> 
> 
> 
> 
> Although a freeze would be a significant step for oil producers, it would have only a limited impact on global supply and the market is unlikely to rebalance before 2017, the International Energy Agency said on Thursday.  The role of Iran, which wants to ramp up production after the lifting of economic sanctions on it in January this year, is a key issue overhanging the Doha talks.  "We have told some OPEC and non-OPEC members like Russia that they should accept the reality of Iran's return to the oil market," Tehran's oil minister Bijan Namdar Zanganeh was quoted as saying by his ministry's news agency SHANA on Saturday.  "If Iran freezes its oil production at the February level, it means it cannot benefit from the lifting of sanctions."
> 
> Publicly, Saudi Arabia has taken a tough stance on Iran. Deputy Crown Prince Mohammed bin Salman told Bloomberg in recent days that the kingdom would only restrain its output if all other major producers, including Iran, agreed to freeze their production. It was not clear if Saudi Arabia would stick to this position at the talks.
> 
> Doha oil producers close to agreeing on output freeze: sources


----------



## william the wie

Doha collapsed. Crude has dropped and is dropping further in Asia.


----------



## HereWeGoAgain

I hope to hell it comes back soon.
It's the only thing holding back the wifes retirement.
   Fuck Iran the Saudis and Barry for fucking over the petroleum industry.


----------



## waltky

Oil meeting breaks up without agreement...

*Oil meeting aiming to cap output ends without agreement*
_Mon, 18 Apr 2016 - A meeting of the world's leading oil producers to discuss capping output and reverse tumbling prices ends without agreement._


> A meeting of the world's leading oil exporters to discuss capping production has ended without agreement.  After hours of talks in Qatar, the country's energy minister Mohammed bin Saleh al-Sada said that the oil producers needed "more time".  Most members of the Opec producers' group, plus other oil exporters including Russia, attended the talks.  They wanted a deal that would freeze output and help stem the plunge in crude prices over the past 18 months.  "The general conclusion was that we need more time to consult among ourselves in Opec and non-Opec producers," Mr Sada said.
> 
> Talks hit difficulties earlier on Sunday as reports emerged of tensions between Iran and Saudi Arabia. Iran did not attend the meeting.  Saudi Arabia, the world's largest oil exporter, appeared willing to only freeze output if all Opec members agreed, including Iran.  But Iran maintained it would continue the increase in oil production it has followed since economic sanctions were lifted earlier this year.  "As we're not going to sign anything, and as we're not part of the decision to freeze output, we ultimately decided it was not necessary to send a representative," the Iranian government said.
> 
> Analysis: Andrew Walker, BBC World Service economics correspondent
> 
> The failure to agree a freeze is not going to help oil exporters desperate to see the price of crude oil rise. They are hurting. Even Saudi Arabia - despite having significant financial buffers - is overhauling its public finances and trying to diversify its economy away from oil.  Other major oil producers are finding life even harder. One OPEC member, Angola, has even gone to the International Monetary Fund seeking to negotiate financial assistance.  There is, perhaps, some compensation for the countries at the Doha meeting in that their failure to agree to curtail supply increases is likely to renew the pressure on shale oil producers in the US, who were not and never would be represented at a gathering such as this.
> 
> The rise of the American shale industry in the last decade or so is one of the main reasons why global supplies are so plentiful and why prices are now less than half what they were in mid-2014.  Mr Sada told reporters after the meeting: "We of course respect [Iran's] position... The freeze could be more effective definitely if major producers, be it from Opec members like Iran and others, as well as non-Opec members, are included in the freeze."  Russia's oil minister Alexander Novak said Moscow had not closed the door on a global deal to freeze output. However, the Reuters news agency reported, Mr Novak said he was disappointed at the failure to reach a decision as he had travelled to Qatar expecting to sign a deal, not debate one.
> 
> *'Mother of all meetings'*



See also:

*Saudi-Iran tensions scupper deal to freeze oil output*
_April 17, 2016 - A deal to freeze oil output by OPEC and non-OPEC producers fell apart on Sunday after Saudi Arabia demanded that Iran join in despite calls on Riyadh to save the agreement and help prop up crude prices._


> The development will revive oil industry fears that major producers are embarking again on a battle for market share, especially after Riyadh threatened to raise output steeply if no freeze deal were reached.  Iran is also pledging to ramp up production following the lifting of Western sanctions in January, making a compromise with Riyadh almost impossible as the two fight proxy wars in Yemen and Syria.  Some 18 oil nations, including non-OPEC Russia, gathered in the Qatari capital of Doha for what was expected to be the rubber-stamping of a deal - in the making since February - to stabilize output at January levels until October 2016.
> 
> But OPEC's de facto leader Saudi Arabia told participants it wanted all members of the Organization of the Petroleum Exporting Countries to take part in the freeze, including Iran, which was absent from the talks.  Tehran had refused to stabilize production, seeking to regain market share post-sanctions.  After five hours of fierce debate about the wording of a communique - including between Saudi Arabia and Russia - delegates and ministers announced no deal had been reached.  "We concluded we all need time to consult further," Qatar's energy minister Mohammed al-Sada told reporters. Several OPEC sources said if Iran agreed to join the freeze at the next OPEC meeting on June 2, talks with non-OPEC producers could resume.
> 
> Russian oil minister Alexander Novak called the Saudi demand "unreasonable" and said he was disappointed as he had come to Doha under the impression that all sides would sign the deal instead of debating it.  Novak said Russia was not shutting the door on a deal but the government would not restrain output for now.  Russia is a key ally of Iran and has been defending Tehran's right to raise output post-sanctions while also supporting the Islamic Republic in many of its conflicts with Riyadh.
> 
> TOUGH SAUDI STANCE


----------



## waltky

Oil prices dive after output talks fail...

*Oil prices dive after producers fail to agree output cap*
_Mon, 18 Apr 2016 - Oil prices are down sharply after a meeting of oil producers fails to agree an output freeze._


> Brent crude fell 7% at one point before recovering some ground. In afternoon trade it fell 3.4% to $41.70 a barrel.  The meeting in Qatar was attended by most members of oil producers' group Opec, including Saudi Arabia, but not Iran.  Saudi Arabia, the world's biggest exporter, had been prepared to freeze output if all Opec members had agreed.  But Iran is continuing to increase output following the lifting of sanctions against it.  "As we're not going to sign anything, and as we're not part of the decision to freeze output, we ultimately decided it was not necessary to send a representative," the Iranian government said.
> 
> 
> 
> 
> 
> After hours of talks in Qatar, the country's energy minister Mohammed bin Saleh al-Sada said that the oil producers needed "more time".  He said after the meeting: "We of course respect [Iran's] position... The freeze could be more effective definitely if major producers, be it from Opec members like Iran and others, as well as non-Opec members, are included in the freeze."
> 
> The price of US crude oil initially fell 6.8%, or $2.82, to $38.68 a barrel. It too clawed back some of those losses and in was trading down 3.6% in the afternoon at $38.90.  The Russian rouble also fell sharply, dropping 2% against the US dollar to 67.79. In mid-afternoon trading it was up 0.57% at 66.65.
> 
> *Analysis: Andrew Walker, BBC World Service economics correspondent*


----------



## william the wie

based on Bloomberg's tiny sample (14 wells from one shale formation) $30-60/bbl is my guess as to probable range until the bankruptcy sale wind up 2-3 years from now at which point I expect data mining to cause a gigantic stepdown.


----------



## waltky

Granny ain't feelin' sorry fer `em...




*IMF expects $500B revenue loss for Mideast oil exporters*
_Monday 25th April, 2016 - Oil exporting countries in the Middle East lost a staggering $390 billion in revenue due to lower oil prices last year, and should brace for even deeper losses of around $500 billion this year, the International Monetary Fund said Monday._


> The fund had projected in October that oil exporting countries in the region would see revenue losses of $360 billion in 2015, but oil prices took a tumble by year's end and the drop in revenue amounted to $30 billion more.  In a revised economic outlook report released Monday, the IMF said these countries will see revenues from oil exports drop even more in 2016, to between $490 billion to $540 billion compared to 2014, when oil prices were higher. Oil prices plunged to around $30 a barrel in January compared to $115 in mid-2014.
> 
> IMF Director for Middle East and Central Asia Masood Ahmed said these losses translate into budget deficits and slower economic growth, particularly for countries like Saudi Arabia that are still heavily dependent on oil to finance their spending. Though the kingdom has been working on plans to overhaul its economy, oil still accounted for 72 percent of total revenue last year and Saudi Arabia projects a budget deficit of nearly $90 billion this year.  The report said that economic growth in the six Gulf Cooperation Council countries of Saudi Arabia, Kuwait, Qatar, Bahrain, Oman and the United Arab Emirates will slow from 3.3 percent in 2015 to 1.8 percent this year. Saudi Arabia, the region's biggest economy, will see growth at just above 2 percent.
> 
> The IMF has encouraged reforms that would limit public spending on welfare programs and handouts that citizens in the Gulf have become accustomed to, such as lifting subsidies and tightening public sector wage bills to offset the impact of declining revenues. Already, most GCC countries have raised fuel, water, and electricity prices. Outside the GCC, oil exporter Algeria recently hiked fuel, electricity, and natural gas prices, and Iran increased fuel prices.  "Oil prices are likely to improve from where they are, but they're not going to go back to the figures that we saw in 2013 and 2014 for a long, long time, so this means that many of them have to cut back spending and they also have to try to raise revenue outside the oil sector," Ahmed told The Associated Press.
> 
> MORE


----------



## william the wie

Waltky it looks like crude is stabilizing @$40-45/bbl as a trading range. Given the following:

much of the layoffs and defaults in fracking are due to 50% leverage at a price of $50-100/bbl so. the deleveraged market value is $25-50/bbl meaning most of those claims will hit the market as soon as the bankruptcies are worked out and go back into production.

Because of the LNG plants coming online and the more dense pipeline networks that are available break even points are a lot lower than when the price collapsed last Aug.

How long until inventory draw downs and bankruptcy court decisions cause a collapse to the $20-40/bbl range?


----------



## longknife

I've noticed that all the buses in Vegas now run on LNG and am seeing lots more conversions. I wonder if this is happening everywhere.


----------



## william the wie

It's still spreading out.


----------



## william the wie

The majors are having serious problems too.


----------



## william the wie

Pipeline companies are cutting back investment.

The majors are reducing investment in refineries

Rig count is going down.

Crude prices are edging up.

Cost of acquisition is going down for crude.

Sounds to me like the second half of this year will see an uptick in production..


----------



## longknife

*As Oil Rises, US Shale Companies Have Begun Increasing Oil Production*



In spite of our “friends” the Saudis!



_Actually we know "when" - it is right about now, as ConocoPhillips admitted just hours ago:_



_CONOCOPHILLIPS CEO SAYS WITH OIL PRICES AT $45 PER BARREL, COULD KEEP PRODUCTION FLAT WITH CASH FLOW FROM OPERATIONS_



_And with every incremental dollar, the supply will only increase._



Story @ As Oil Rises, US Shale Companies Have Begun Increasing Oil Production | Zero Hedge


----------



## william the wie

longknife said:


> *As Oil Rises, US Shale Companies Have Begun Increasing Oil Production*
> 
> 
> 
> In spite of our “friends” the Saudis!
> 
> 
> 
> _Actually we know "when" - it is right about now, as ConocoPhillips admitted just hours ago:_
> 
> 
> 
> _CONOCOPHILLIPS CEO SAYS WITH OIL PRICES AT $45 PER BARREL, COULD KEEP PRODUCTION FLAT WITH CASH FLOW FROM OPERATIONS_
> 
> 
> 
> _And with every incremental dollar, the supply will only increase._
> 
> 
> 
> Story @ As Oil Rises, US Shale Companies Have Begun Increasing Oil Production | Zero Hedge



Sad to say the obvious that you have just pointed out does have to be pointed out and linked for many people to get it.


----------



## waltky

Sounds like the demand side is makin' a comeback...

*As oil plows through $45 a barrel, U.S. producers rush to lock in prices*
_Mon May 2, 2016 - U.S. oil producers pounced on this month's 20 percent rally in crude futures to the highest level since November, locking in better prices for their oil by selling future output and securing an additional lifeline for the years-long downturn._


> The flurry of dealing kicked off when prices pierced $45 per barrel earlier in April. It picked up in recent weeks, allowing producers to continue to pump crude even if prices crash anew.  While it was not clear if oil prices will remain at current levels, it may also be a sign producers are preparing to add rigs and ramp up output.  This week, Pioneer Natural Resources Co (PXD.N), a major producer in the Permian shale basin of West Texas, said it would add rigs with oil prices above $50 per barrel.  Selling into 2017 tightened the structure of the forward curve, with December 2017's premium to December 2016 CLZ6, known as a contango, narrowing to $1.30, its tightest since June 2015. That spread had been as wide as $2.15 a barrel just four days earlier.
> 
> Open interest in the December 2017 CLZ7 WTI contract was at a record high of 122,533 lots on Friday, up about 20,000 lots from the start of April.  "U.S. producers have been quick to lock in price protection as the market rallies given that the vast number of companies remain significantly under hedged relative to historically normal levels," said Michael Tran, director of energy strategy at RBC Capital Markets in New York.  It was not clear which companies embarked on the forward selling. In the past a handful of producers such as Anadarko Petroleum (APC.N) have sporadically hedged in large chunks.  But trade sources pointed to increased activity among financial instruments for the balance of 2016, calendar year 2017 and even 2018.
> 
> 
> 
> 
> 
> Oil pump jacks are seen next to a strawberry field in Oxnard, California​
> The uptick in producer hedging activity came as benchmark West Texas Intermediate (WTI) futures finished April up 20 percent for the biggest monthly increase in a year. Prices have rebounded by as much as 80 percent on expectations of falling U.S. production after touching a 12-year low in February.  On Friday, Baker Hughes reported oil drillers removed another 11 from operation the week to April 29, bringing the total oil rig count to 332, its lowest since November 2009.  The calendar 2017 strip CLCALYZ7 week climbed to $49.44 on Thursday, its strongest since early December. In January, it had traded as low as $37.38 a barrel.
> 
> To outlast the downturn, many producers like Continental Resources (CLR.N), are deferring completions on already drilled wells, known as DUCs.  "There are some companies that will hedge at $45 and $50, giving them more incentive to bring those DUCs on line," said Hakan Carapcioglu, an energy market analyst with Ponderosa Advisors, a Denver-based consultancy.  To be sure, many have questioned the fundamentals backing the recent oil rally, particularly as U.S. crude inventories currently stand at a record 540.6 million barrels, according to the latest data from the Energy Information Administration.
> 
> As oil plows through $45 a barrel, U.S. producers rush to lock in prices


----------



## william the wie

stockpiles will shrink rapidly.


----------



## waltky

Looks like more oil gonna be comin' down the pipeline...

*U.S. energy CEOs ready for new drilling as oil prices plot upward path*
_Wed May 4, 2016 - After cutting spending and staff levels to the bone, U.S. oil executives say they are getting ready for new drilling projects as a 50 percent increase in crude prices since February leads them to believe the worst of the downturn may be over._


> Any price rise above $50 per barrel could fuel a resurgence in the U.S. shale industry, which saw drilling and fracking of new wells put on hold over the past year as oil prices plumbed near $25 per barrel.  But prices have steadily risen to around $44 per barrel, near levels where money could start flowing again. While myriad factors could push prices lower again and many companies are stuck in bankruptcy, prominent executives say there is a pending upswing in oilfield activity globally and that work will come back fastest in North America.  "The outlook for commodity prices is improving," Al Walker, chief executive of oil producer Anadarko Petroleum Corp (APC.N), said on Tuesday after the company posted better-than-expected quarterly results.  "It goes without saying that things look better today than they did 90 days ago."
> 
> 
> 
> 
> 
> Stacked rigs are seen along with other idled oil drilling equipment at a depot in Dickinson, North Dakota​
> Dave Lesar, chief executive of oilfield services provider Halliburton Co (HAL.N), said he believes the U.S. drilling rig count has hit a bottom and likely will rise later this year.  U.S. oil drillers last week cut rigs for the sixth week in a row to the lowest level since November 2009. The industry has shed more than 250,000 jobs globally, nearly half in the United States.  "Certainly with oil prices a little higher, people are more optimistic," Lesar said on Tuesday. "We do think that potentially we'll see an upswing in the rig count in the back half of the year."  A rising rig count would translate into more wells being drilled that can be fracked.
> 
> On staffing, Halliburton noted it hired 21,000 people globally in 2014 - before laying many of them off in 2015 as oil prices crashed - and could quickly add staff back.  Any rise in oil field activity would be a boon for Halliburton, which this week scrapped its planned buyout of rival Baker Hughes Inc (BHI.N).  Both companies are now trying to anticipate needs from customers, such as Anadarko, which send ripples across vast supply chains when they lift spending.  Last week, Pioneer Natural Resources (PXD.N) CEO Scott Sheffield said he would add rigs if oil stays near or rises from $50 a barrel. And Whiting Petroleum Corp (WLL.N), the largest oil producer in North Dakota, said it would soon frack 44 wells to bring them online - just weeks after saying it would freeze virtually all new work.
> 
> Baker Hughes expects oil at $50 or above would fuel the fracking of several hundred wells per month.  "This represents a significant near-term opportunity," Martin Craighead, the chief executive of Baker Hughes, said on Tuesday.  The services companies are telling analysts they are ready to capture new orders.  "When this thing snaps back, it's going to snap back hard," said Lesar, the Halliburton CEO. "We believe that when this market recovers it will be North America that responds the fastest, offering the greatest upside."
> 
> U.S. energy CEOs ready for new drilling as oil prices plot upward path


----------



## william the wie

That's going to get interesting.


----------



## william the wie

The tar sands fire is driving prices, we are above the sustainable price for oil.


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## waltky

Once again, thank Nigeria for higher oil prices...




*Oil prices rise on Nigeria outages, Goldman forecast*
_May 16, 2016 - Oil prices jumped over 2 percent on Monday to their highest since November 2015 on growing Nigerian oil output disruptions and after long-time bear Goldman Sachs said the market had ended almost two years of oversupply and flipped to a deficit._


> Brent crude futures were trading at $48.83 per barrel at 1118 GMT, up $1 or 2.05 percent. U.S. crude futures were up 98 cents, or 2.08 percent, at $47.19 a barrel.  Supply disruptions around the world of as much as 3.75 million barrels per day (bpd) have wiped out a glut that pulled down oil prices by as much as 70 percent between 2014 and early 2016.  The disruptions triggered a U-turn in the outlook of Goldman Sachs, which had long warned of global storage hitting capacity and of yet another oil price crash to as low as $20 per barrel.  "The oil market has gone from nearing storage saturation to being in deficit much earlier than we expected," Goldman said.  "The market likely shifted into deficit in May ... driven by both sustained strong demand as well as sharply declining production," it said.
> 
> However, Goldman cautioned that the market would flip back into a surplus in the first half of 2017 as it said prices around $50 per barrel in the second half of 2016 would see exploration and production activity picking up.  In Nigeria, output has fallen to its lowest in decades following several acts of sabotage.  In the Americas, U.S. officials warned they were growing increasingly concerned by the possibility of an economic and political meltdown in Venezuela amid low oil prices.  Venezuela's oil production has already fallen by at least 188,000 bpd this year.
> 
> In the United States, crude production has fallen to 8.8 million bpd, 8.4 percent below 2015 peaks as the sector suffers a wave of bankruptcies.  And in China, output fell 5.6 percent to 4.04 million bpd in April, year-on-year.  Countering this, supply rose from the Organization of the Petroleum Exporting Countries (OPEC) as its producers are engaged in a race for market share.
> 
> OPEC pumped 32.44 million bpd in April, up 188,000 bpd from March, the highest since at least 2008.  Also preventing steeper price jumps was a recovery in output in Canada following closures due to a wildfire, as well as bloated global crude storages.  "The inventory buffer may be preventing full price recovery and ... the market is rightly nervous about the sustainability of outages," said Morgan Stanley. Barclays said that "while the supply-side disruptions are supporting oil market balances, refinery margins are starting to weaken, especially in Asia," adding that weaker demand from those refiners could produce "downside risk to prices in Q3 16."
> 
> Oil prices rise on Nigeria outages, Goldman forecast


----------



## waltky

Oklahoma's way of dealing with the oil bust...




* Special report: As oil boom goes bust, Oklahoma protects drillers and squeezes schools*
_May 17 2016 - After intense lobbying, Oklahoma’s oilmen scored a victory two years ago. State lawmakers voted to keep in place some of the lowest taxes on oil and gas production in the United States - a break worth $470 million in fiscal year 2015 alone._


> The state’s schools haven’t been so fortunate. In Newcastle, 23 miles from the capital of Oklahoma City, John Cerny recently learned that the school attended by his five-year-old granddaughter, Adelynn, will open just four days a week next year. The Bridge Creek school district will slash spending because of a projected $1.3 billion state budget shortfall next year.  Beth Lawton teaches first grade at Broadmoore Elementary in Moore, a city of 59,000 bordering the capital. In April, she and several colleagues were told their contracts won’t be renewed because of funding cuts. Broadmoore’s class sizes are expected to rise next year as a result.  “I think our lawmakers have failed us, and I don’t understand how little they value education,” Lawton said.
> 
> Oklahoma’s school-funding crisis is part of the pain inflicted by falling oil prices on energy-rich states across America that rely on natural-resources taxes to pay their governments’ bills. But the crisis in Oklahoma is especially dire, exacerbated by a legacy of large tax breaks bestowed upon oil companies.  Before the recent 60 percent decline in oil prices, a drilling bonanza minted millionaires and billionaires in Oklahoma. The boom turned sleepy Oklahoma City into a thriving hub for drillers like Devon Energy (DVN.N), Chesapeake Energy (CHK.N) and Continental Resources (CLR.N) - the troika that lobbied hardest for the tax-break extension. The rebuilt downtown hosts top notch dining, hotels, arts venues, and a top NBA basketball team.
> 
> But as private oil wealth created these emblems of prosperity, public services have come under severe strain. In contrast to other energy states, Oklahoma didn’t fill state coffers during flush years.  Oklahoma taxed new oil and gas production from its prolific horizontal wells - the big money-makers of the fracking industry - at rates as low as 1 percent throughout the shale boom. In North Dakota’s giant Bakken oilfield, the going rate was 11.5 percent.
> 
> MISSED OPPORTUNITY?


----------



## elektra

waltky said:


> Oklahoma's way of dealing with the oil bust...
> 
> 
> 
> 
> * Special report: As oil boom goes bust, Oklahoma protects drillers and squeezes schools*
> _May 17 2016 - After intense lobbying, Oklahoma’s oilmen scored a victory two years ago. State lawmakers voted to keep in place some of the lowest taxes on oil and gas production in the United States - a break worth $470 million in fiscal year 2015 alone._
> 
> 
> 
> The state’s schools haven’t been so fortunate. In Newcastle, 23 miles from the capital of Oklahoma City, John Cerny recently learned that the school attended by his five-year-old granddaughter, Adelynn, will open just four days a week next year. The Bridge Creek school district will slash spending because of a projected $1.3 billion state budget shortfall next year.  Beth Lawton teaches first grade at Broadmoore Elementary in Moore, a city of 59,000 bordering the capital. In April, she and several colleagues were told their contracts won’t be renewed because of funding cuts. Broadmoore’s class sizes are expected to rise next year as a result.  “I think our lawmakers have failed us, and I don’t understand how little they value education,” Lawton said.
> 
> Oklahoma’s school-funding crisis is part of the pain inflicted by falling oil prices on energy-rich states across America that rely on natural-resources taxes to pay their governments’ bills. But the crisis in Oklahoma is especially dire, exacerbated by a legacy of large tax breaks bestowed upon oil companies.  Before the recent 60 percent decline in oil prices, a drilling bonanza minted millionaires and billionaires in Oklahoma. The boom turned sleepy Oklahoma City into a thriving hub for drillers like Devon Energy (DVN.N), Chesapeake Energy (CHK.N) and Continental Resources (CLR.N) - the troika that lobbied hardest for the tax-break extension. The rebuilt downtown hosts top notch dining, hotels, arts venues, and a top NBA basketball team.
> 
> But as private oil wealth created these emblems of prosperity, public services have come under severe strain. In contrast to other energy states, Oklahoma didn’t fill state coffers during flush years.  Oklahoma taxed new oil and gas production from its prolific horizontal wells - the big money-makers of the fracking industry - at rates as low as 1 percent throughout the shale boom. In North Dakota’s giant Bakken oilfield, the going rate was 11.5 percent.
> 
> MISSED OPPORTUNITY?
Click to expand...

Schools get too much money, way too much, it is about time they did with less. They should fire the administrators, we don't need so many pencil pushers. And lets not forget that none of the old school books are good anymore, they do not include homosexuality and common core, so they all need to be thrown out and new school books need to be bought. And of course lets not forget that Computer Based Testing is now mandatory as well, you know the testing that is you must answer this question this way before you proceed to the next question, that way they can teach through testing. 

Yep, tough luck for the schools, it is hard to spend on all the Unions and Federal, and State governments are demanding.


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## BuckToothMoron

Billyjack said:


> Oil prices have always been manipulated. From Drake(1859) to Opec(1971) oil prices were kept artificailly low by the major refiners becuase their refinery margins are better at low crude oil prices than high. For the record Exxon is a net crude oil buyer not a seller, they only make money by selling gasoline. In 1971, we had the first Arab oil embargo and then the price was made artificially high when OPEC was able to restrict production and create an under supply situation. Then oil began trading as a commodity in 1981, yet the supply was still short. The first time in history that the market actually reflected the true price of oil was 1986 when prices dropped from around $40/bbl to less than $8/bbl. At that time supply was close to 75 mmbopd versus demand of around 55 mmbopd.  Prices stayed low until the 1990's as consumption increased 2 mmbopd/year while the production side was in a depression and created no new supply. Just a little history, sorry.
> Goldman and 3 or 4 hedge funds control about 60% of the market trades on the CME. They were caught a few years back making 100,000,000 barrel 24 hour round trip trades to insure their position. In an over supply situation the speculators will control prices not OPEC.



OPEC has lost their big stick or at least had it shortened with the increase production from N. America. That coupled with slow economic conditions across most of the world has stifled their influence. Ever heightening tension between Saudis and Iran  doesn't help OPEC either.


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## william the wie

What is strange are the producers who are only pumping to service their debts are keeping up the pace of innovation. The companies that are above their breakeven point are lowering their leverage so they can take advantage of the switch to winterblend this fall and buy up properties at $0.1/$. The combination of declining costs and higher prices means that next year's switch to summer blend and the completion of LNG plants already under construction means ever lower prices at an ever slower pace.


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## waltky

Looks like we've reached the new normal...





*Oil prices top $50, Asian shares struggle on China worries*
_May 25 2016 - Brent crude oil rose above $50 a barrel for the first time in nearly seven months on Thursday but Asian shares struggled to gain traction, with worries about U.S. interest rates and China's slowing economy keeping many investors on the sidelines._


> While energy stocks outperformed, a slump in mainland China stocks to 2-1/2 month lows dampened any broader interest in riskier assets in Asia, offsetting overnight gains on Wall Street.  "The market environment is not bad overall. Oil prices are rising, which would benefit oil producing countries. But Asia may be hurt by concerns about the Chinese economy," said Shuji Shirota, associate director at HSBC in Tokyo.  "The market's focus is returning to the Fed, given rising expectations that they could hike rates much earlier than expected. That is weighing on many emerging markets as well," he said.  Japan's Nikkei rose 0.3 percent but MSCI's broadest index of Asia-Pacific shares outside Japan was almost flat, struggling to extend its rebound from Tuesday's 12-week low. It had gained 1.2 percent on Wednesday.  Shanghai shares fell more than 1 percent, with sentiment frail after a series of disappointing economic data earlier this month and fears that policymakers may be taking a more cautious stance on further stimulus as debt levels grow.
> 
> Share prices rallied globally overnight, led by European banks, which benefit from a decision by euro zone finance ministers to unlock new funds for Greece and to give it a firm offer of debt relief.  On Wall Street, U.S. S&P 500 Index rose around 0.7 percent to 2,091, its highest in almost a month and near its six-month intraday high of 2,111.  Energy stocks outperformed on the back of continued recovery in oil prices, which hit seven-month highs after the U.S. government reported a larger-than-expected drop in crude inventories. [O/R]  Global benchmark Brent futures rose 34 cents or about 0.6 percent to as high as $50.08 per barrel, the highest level since early November. U.S. West Texas Intermediate (WTI) hit $49.88, a seven-month high.  The rally in U.S. and European shares came even as investors readied themselves for monetary tightening by the U.S. Federal Reserve as early as next month.
> 
> The yield on two-year U.S. notes rose to a 10-week high of 0.938 percent on Wednesday as investors priced in the likelihood of the Fed raising its federal funds target rate to 0.50-0.75 percent from the current 0.25-0.50 percent in coming months.  It last stood at 0.903 percent, almost a quarter percentage point above this month's low of 0.686 percent.  Market players are awaiting comments by Fed Chair Janet Yellen at a Harvard University event on Friday, though many also say her speech scheduled for June 6 - after new U.S. payrolls data comes out - would be even more crucial.  Recent comments by Fed policymakers have put a possible rate hike this summer firmly on the table for discussion, but U.S. interest rate futures <0#FF:> are still pricing in only about one-third chance of a rate hike in June and about a 60 percent likelihood by July.
> 
> The prospects of higher U.S. interest rates undermined the attraction of gold, which fell to a seven-week low of $1,217.90 per ounce though it came back up a tad in Asia to trade at $1,231.  In the currencies, sterling rose to $1.4700, near its four-month peak of $1.4770 hit earlier this month, as several bookmakers widened the odds on a British "Brexit" from the European Union after opinion polls showing the "in" camp leading.  The dollar was generally supported by U.S. rate hike expectations, while the euro stood at $.1151, having hit a 10-week low of $1.1129 overnight.  But it saw a 0.5 percent loss against the yen to 109.64 yen in early Asian trade in an erratic move.
> 
> Oil prices top $50, Asian shares struggle on China worries


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## william the wie

It ain't carved in stone but it looks like Iran has too many commitments and too many scandals of mullah crazies to get upto full production and that was not anticipated.


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## waltky

The oversupply of oil is easing in the United States...




*Lower Supplies Boost Oil Prices, With Demand Expected to Grow*
_ May 26, 2016 | WASHINGTON — Oil prices rose above $50 a barrel Thursday for the first time this year, following a report the oversupply of oil is easing in the United States._


> Oil prices have plunged during the past year, hurting oil exporting nations and petroleum companies, which cut jobs and investments in the oil industry.  Economists say the damage to demand in the economy was larger than expected, while the boost to consumers from lower gasoline prices had less impact than experts predicted.  As a result, investors worried and stock markets had faltered.  But Thursday, many global stock markets made gains as oil prices rose to their highest level in seven months.
> 
> 
> 
> 
> 
> A attendant fills up a car at a gas station in Jiddah, Saudi Arabia, Sept. 15, 2015. Oil prices rose above $50 a barrel Thursday for the first time this year.​
> The earlier price plunge grew out of a surge in oil production from advanced technologies, like fracking in the United States, which boosted oil supplies.  In the past when supplies were higher than demand, OPEC nations, particularly Saudi Arabia, have cut production to keep prices strong.  But the Saudis have changed their strategy, maintaining production, perhaps hoping that falling prices would force competitors, particularly those that have higher production prices, out of business.
> 
> Over the long term, experts at the Organization of Petroleum Exporting Countries predict population growth will boost demand for energy by 50 percent, and oil products will fill most of that demand for decades to come.  OPEC says the global population will grow by 1.7 billion by 2040, and the number of private cars will double to more than two billion, while electric service will expand to many people who now lack access.
> 
> Lower Supplies Boost Oil Prices, With Demand Expected to Grow


----------



## waltky

Not much the Saudis can do about it, the market is back in control of prices now...
*



*
*Saudis pledge not to shock oil market as OPEC debates policy*
_Thu Jun 2, 2016 - Saudi Arabia promised on Thursday not to flood the oil market with extra barrels as OPEC entered a heated debate about production policy, with Iran insisting on the right to raise output steeply._


> Tensions between the Sunni-led kingdom and the Shi'ite 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.  Several OPEC sources said Saudi Arabia and its Gulf allies would propose to set a new collective ceiling in an attempt to repair OPEC's waning importance and end a market-share battle that has sapped prices and cut investment.
> 
> Failure to reach any deal would revive market fears that OPEC's largest producer Saudi Arabia, already pumping near record highs, may raise production further to punish rivals and gain additional market share.  "We will be very gentle in our approach and make sure we don't shock the market in any way," new Saudi Energy Minister Khalid al-Falih told reporters ahead of the meeting.  "There is no reason to expect that Saudi Arabia is going to go on a flooding campaign," Falih said when asked whether Saudi Arabia could add more barrels to the market.  Answering a question on whether Riyadh would propose setting a collective output ceiling, he said: "We will do that when necessary‎." He added that he would listen to anything Iran brings to the table.
> 
> Any agreement between Riyadh and Tehran would be seen as a big surprise by the market, which in the past two years has grown increasingly used to clashes between the political foes as they fight proxy wars in Syria and Yemen.  Saudi Arabia effectively scuppered plans for a global production freeze - aimed at stabilising oil markets - in April. It said then that it would join the deal, which would also have involved non-OPEC Russia, only if Iran agreed to freeze output.  Tehran has been the main stumbling block for the Organization of the Petroleum Exporting Countries to agree on output policy over the past year as the country boosted supplies despite calls from other members for a production freeze.
> 
> Tehran argues it should be allowed to raise production to levels seen before the imposition of now-ended Western sanctions over Iran's nuclear program.  Iranian Oil Minister Bijan Zanganeh said Tehran would not support any new collective output ceiling and wanted the debate to focus on individual country production quotas.  "Without country quotas, OPEC cannot control anything," Zanganeh told reporters. He insisted Tehran deserved a quota - based on historic output levels - of 14.5 percent of OPEC's overall production.
> 
> OPEC is pumping 32.5 million barrels per day (bpd), which would give Iran a quota of 4.7 million bpd - well above its current output of 3.8 million, according to Tehran's estimates, and 3.5 million, based on market estimates.  Zanganeh said he supported a candidate from Nigeria for the post of OPEC secretary-general, which could emerge as a rare compromise within the organization if Riyadh also backs the appointment.
> 
> COUNTRY QUOTAS


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## waltky

This should bring gas prices down in the near term...




*Exclusive: As Iran's oil exports surge, international tankers help ship its fuel*
_Mon Jun 6, 2016 - More than 25 European and Asian-owned supertankers are shipping Iranian oil, data seen by Reuters shows, allowing Tehran to ramp up exports much faster than analysts had expected following the lifting of sanctions in January._


> Iran was struggling as recently as April to find partners to ship its oil, but after an agreement on a temporary insurance fix more than a third of Iran's crude shipments are now being handled by foreign vessels.  "Charterers are buying cargo from Iran and the rest of the world is OK with that," said Odysseus Valatsas, chartering manager at Dynacom Tankers Management. Greek owner Dynacom has fixed three of its supertankers to carry Iranian crude.  Some international shipowners remain reluctant to handle Iranian oil, however, due mainly to some U.S. restrictions on Tehran that remain and prohibit any trade in dollars or the involvement of U.S. firms, including banks and reinsurers.  Iran is seeking to make up for lost trade following the lifting of sanctions imposed in 2011 and 2012 over its nuclear program.
> 
> Port loading data seen by Reuters, as well as live shipping data, shows at least 26 foreign tankers with capacity to carry more than 25 million barrels of light and heavy crude oil, as well as fuel oil, have either loaded crude or fuel oil in the last two weeks or are about load at Iran's Kharg Island and Bandar Mahshahr terminals.  The resumption of international shipping of Iranian oil has been made possible by an increase in interim, limited, insurance cover by "P&I clubs" - maritime mutual associations that provide "protection and indemnity" insurance to shippers.  The International Group of P&I Clubs, which represents the world's top 13 ship insurers, increased the amount covered by so-called "fall-back" shipping insurance from 70 million to 100 million euros ($113.36 million) in April.  "In the first days after lifting sanctions only Iranian ships were loaded in the country, mainly due to several problems in finding insurance/reinsurance," said Luigi Bruzzone of ship broker Banchero Costa.  "The strong interest of the market in these trades pushed all the stakeholders to solve all the problems ... and almost all P&I Clubs have granted their insurance."
> 
> INSURANCE RISK?
> 
> The "fall-back" cover is designed to offset any shortfall in payments from U.S. reinsurers, who are still not allowed to deal with Iran.  "We are not surprised to see the increase in Iranian cargoes given the progress made by the P&I clubs and obviously the increase in Iranian production," said Brian Gallagher, head of investor relations at leading Belgian tanker owner Euronav, which itself is not involved in Iran yet.  "We're interested in such trade ... (but) it will still take time for Iran to be fully integrated as there remain restrictions around dollar denominated transactions."  Indeed, while the partial lifting of sanctions means foreign tankers can now transport Iranian oil, risks remain because large accidents might not be fully covered.
> 
> As a result, insurers say many first-tier oil shippers, many of them publicly listed such as Euronav, Teekay Group or Frontline, still shy away from carrying Iranian oil.  If the fall-back cover is exhausted in an incident, Andrew Bardot, executive officer at the International Group of P&I Clubs, said that costs like "collision and cargo liabilities, will not be covered, and will remain with the shipowner".  A single Very Large Crude Carrier (VLCC) supertanker costs around $90 million, and the costs of a large oil spill can reach into the billions of dollars.  "The limitations of the 'fall-back' cover - together with other continuing restrictions, for example those relating to the U.S. dollar and use of the U.S. financial system - however have discouraged a number of shipowners, and in particular the large shipping groups, from resuming trade with Iran in which they were previously engaged," said Bardot.
> 
> NEAR PRE-SANCTIONS LEVELS


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## william the wie

That should cause prices to drop.


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## waltky

Dis is what's happenin' - we's fallin', fallin' fallin'...




*Wall St. drops with banks and oil as bonds rally*
_June 9, 2016 - Banks led Wall Street lower on Thursday, mirroring global stocks, as oil prices fell and bond markets rallied amid demand for safe haven assets._


> An index of world equity markets snapped a five-day winning streak. Oil prices snapped a three-day rally as traders took profits, pulling commodity-related stocks lower.  Global stocks were hit after European Central Bank President Mario Draghi warned that monetary policy alone would not avert the risk of Europe suffering lasting economic damage from weak productivity and low growth.  The ECB started buying back corporate bonds on Wednesday, which along with the concerns about Britain's referendum on European Union membership, pushed British and German sovereign debt yields to record lows.
> 
> U.S. Treasury yields fell to three-and-a-half month lows on fading chances of the Federal Reserve raising interest rates at its policy meeting next week.  A combination of oil prices, Draghi's warning and some risky events especially the UK vote later in the month are affecting the market, said Julian Emanuel, a U.S. Equity and Derivative Strategist at UBS.  "What we have seen is that the public has been cautious and that wall of worry is ... challenging valuations ahead of some discreetly risky events and today's profit taking is almost a natural process," Emanuel said.
> [/B]
> *
> 
> 
> 
> 
> Traders work on the floor of the NYSE in New York City*​*At 12:47 p.m. ET the Dow Jones Industrial Average <.DJI> was down 60.85 points, or 0.34 percent, at 17,944.2.  The S&P 500 <.SPX> was down 8.39 points, or 0.4 percent, at 2,110.73 and the Nasdaq Composite <.IXIC> was down 26.46 points, or 0.53 percent, at 4,948.18.  Nine of the 10 major S&P sectors were lower, led by a 1.2 percent decline in the financial index <.SPSY>. The KBW Bank Index <.BKX> was off 1.8 percent.  The financial index is the only one of the S&P sectors in the red for this year, hit by concerns of bad debt on loans to energy companies, uncertainty about interest rates and fears of slowing global growth.
> 
> Goldman Sachs <GS.N> fell 1.2 percent and was the biggest drag on the Dow, while Wells Fargo's <WFC.N> 2 percent decline pulled the S&P down the most.  Chesapeake Energy <CHK.N> fell 5.8 percent to $4.68 after an RBC downgrade. Other energy stocks also dropped with oil prices.  J.M. Smucker <SJM.N> jumped 7.3 percent to $142.39 after the processed foods maker reported better-than-expected rise in quarterly sales.  Declining issues outnumbered advancing ones on the NYSE by 2,045 to 911. On the Nasdaq, 2,027 issues fell and 707 advanced.  The S&P 500 index showed 43 new 52-week highs and no new lows, while the Nasdaq recorded 61 new highs and 23 new lows.
> 
> Wall St. drops with banks and oil as bonds rally*


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## william the wie

US rig count up two weeks in a row


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## longknife

*More and More Oil Ships Anchored off Major Seaports*







The two mentioned are Singapore and Rotterdam. And this articles says price has little to do with it claiming it's a case of not having onshore storage for the cargoes. Too much crude, not enough storage, and lack of refineries.

Read the full story @ Why are more and more oil ships anchoring off Singapore?


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## william the wie

longknife said:


> *More and More Oil Ships Anchored off Major Seaports*
> 
> 
> 
> 
> 
> 
> 
> The two mentioned are Singapore and Rotterdam. And this articles says price has little to do with it claiming it's a case of not having onshore storage for the cargoes. Too much crude, not enough storage, and lack of refineries.
> 
> Read the full story @ Why are more and more oil ships anchoring off Singapore?



With trade down this makes sense for the ship owners. It makes sense for the people who have already sold the oil on the futures market and rented the tankers as warehouses until delivery can be made. However that doesn't make sense for the folks on the other side of the trade. A lot of people are going to become millionaires the easy way, start off as billionaires.


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## waltky

Looks like gas prices goin' up...




*Oil prices rise on first drop in U.S. drilling in months*
_Mon Jul 3, 2017 | Oil markets edged up on Monday, lifted by the first fall in U.S. drilling activity in months, although price gains were capped by reports of rising OPEC output last month even as the group has pledged to cut supply._


> Brent crude futures had climbed 13 cents, or 0.3 percent, to $48.90 per barrel by 0643 GMT, after jumping 5.2 percent last week in their first weekly gain in six weeks.  U.S. West Texas Intermediate (WTI) crude futures rose 17 cents, or 0.4 percent, to $46.21 per barrel, adding to last week's 7-percent gain.  U.S. prices were lifted as drilling activity in the United States for new oil production fell for the first time since January, dropping by two rigs.  Futures brokerage AxiTrader said on Monday that this was "the first crack in the resolve of U.S. shale oil to continue to ramp up production regardless of the big fall in price" earlier this year.
> 
> 
> 
> 
> 
> A wellhead is seen at an Occidental Petroleum Corp carbon dioxide enhanced oil recovery project in Hobbs, New Mexico​
> Despite the dip in U.S. drilling activity, the total rig count was still more than double the 341 rigs in the same week a year ago, according to energy services firm Baker Hughes Inc.  However, traders said that WTI prices were also being supported by expectations of strong gasoline consumption on the July 4 holiday in the United States.  Globally, oil markets remain oversupplied as output from within the Organization of the Petroleum Exporting Countries (OPEC) hit a 2017 high.
> 
> June OPEC production was up by 280,000 barrels per day (bpd) to 32.72 million bpd, according to a Reuters survey, despite the group's pledge to hold back output in an effort to tighten the market.  "To put that in context, that is nearly a quarter of the 1.2 million barrels (per day) OPEC agreed to cut," said Greg McKenna, chief market strategist at AxiTrader, adding this increase was driven by higher output from Nigeria and Libya, which were exempted from the cuts.
> 
> Oil prices rise on first drop in U.S. drilling in months


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## longknife

I don't see a thing in the media about how much cheaper gas and diesel is this year from last year at this time.

What were gas prices in 2016?
Consider the following: The national average price of gasoline has declined each year since 2012 (*$3.60*), 2013: *$3.48*, 2014: *$3.34*, 2015: *$2.40*. to the hikes seen 5 to 10 years ago. Since 2012 that climb has averaged *53 cents* per gal.
*Fuel Price Outlook 2016 - GasBuddy.com*
fuelinsights.gasbuddy.com/content/docs/2016forecast.pdf


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## CrusaderFrank

Thanks, Obama


----------



## waltky

Saudis gonna raise oil prices next month...




*Saudi Arabia may raise December crude oil prices to Asia to highest in few years*
_November 1, 2017  - Top oil exporter Saudi Arabia will hike December crude prices for customers in Asia to levels last seen in 2013 or 2014, a Reuters survey showed, with OPEC-led output cuts and robust demand re-balancing markets for the commodity. _


> The producer is expected to raise flagship Arab Light’s December official selling price to at least 90 cents a barrel above Oman/Dubai quotes, the survey of five refiners showed. That would be the highest premium since $1.65 in September 2014, according to Reuters data.  Prices for heavier grades may see a bigger boost in December, the survey showed, with Arab Heavy’s OSP set to rise to at least $1.30 below Oman-Dubai quotes. That would be the narrowest discount for Saudi heavy crude since minus $1.05 in December 2013, according to Reuters data.
> 
> The increases would come on the back of stronger Middle East crude benchmark prices and firm refining margins, the respondents said.  Dubai’s backwardation widened in October compared with the previous month. In a backwardated market, prompt prices are higher than those in future months signaling strong demand for spot cargoes.  Complex refining margins in Singapore, a gauge of refiner profitability in the region, held above $7 a barrel for a fourth month in October, Thomson Reuters Eikon data showed.
> 
> Gains in naphtha margins could prop up Arab Extra Light’s OSP in December by at least 50 cents a barrel, the survey showed.Saudi crude OSPs are usually released around the fifth of each month, and set the trend for Iranian, Kuwaiti and Iraqi prices, affecting more than 12 million barrels per day (bpd) of crude bound for Asia.
> 
> Saudi Aramco sets its crude prices based on recommendations from customers and after calculating the change in the value of its oil over the past month, based on yields and product prices.  Saudi Aramco officials as a matter of policy do not comment on the kingdom’s monthly OSPs.
> 
> Saudi Arabia may raise December crude oil prices to Asia to highest in few years


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## william the wie

Will it sell at that price?


----------

