Здравствуйте. Вся информация этого сайта бесплатна. Вы можете сделать пожертвование и поддержать наше развитие. Спасибо.

Hello. All information of this site is free of charge. You can make a donation and support our development. Thank you.

2016-08-24 18:50:00

PRICE CAN BE STRONGER

PRICE CAN BE STRONGER

 

OIL PRICES AUG 2016

 

OIL PRICES SEP 2015 - AUG 2016

 

FT wrote, one of the factors both accompanying and abetting the current rally in emerging market assets is the recent jump in the oil price, with Brent crude up about one-fifth to $50 a barrel since the start of this month. It is now back to levels not seen since last autumn (apart from a brief flurry this June). What is going on?

Quite a number of things, argues Medley Global Advisors, a macro research service owned by the FT. On top of the weaker dollar and technical factors such as reduced summer trading and expiries in the options markets there is a continued drawdown in US gasoline inventories, US production declines and dreams of a cold northern hemisphere winter (of which more later).

But the most immediate spur to the crude price has been talk from Saudi Arabia's new oil minister that hinted at another attempt by the kingdom to organise an output freeze among Opec members.

To most investors, the oil cartel continues to look like a dysfunctional organisation. There are few things the Saudis and Iranians can agree on, for a start. And the former have been raising their own production over the summer while preaching forbearance at others — though much of that extra oil is being burnt domestically rather than exported. So the risk of a market disappointment leading up to the next Opec meeting, which is not until the end of November, is very possible.

Having said that, the Saudis very much regard $50/barrel as a floor for the oil price and are already extending feelers to Russia and other less hardline Opec members regarding potential output quotas, while their own exports have actually been stable to slightly down this year. So some type of production freeze remains a real possibility.

Meanwhile, the global balance between supply and demand continues to adjust in favour of higher prices. Output in Nigeria is hovering around 1.4m barrels/day, some 700,000 b/d down from 2015's peak as more than 10 separate attacks on facilities in the Niger Delta this year have taken their toll. MGA remains pessimistic about the government's capacity to pacify a new generation of militants who are pushing — however unrealistically, ultimately — to secede from Abuja.

In Libya, despite repeated attempts to establish a unified government and some success in pushing back Isis, infighting between the various rival political and religious movements remains the order of the day and the bulk of the country's oil facilities remain shut in. Libya, which once pumped 1.6m b/d is currently managing just over 300,000 b/d.

On top of that, Angola is on course for a big drop in output later this year as its refineries go into maintenance and production is also down across most of Latin America (especially Venezuela) and — most significantly — in the US shale oil basins.

The US, in fact, is the final piece in the puzzle since this is where the rebalancing of supply and demand can be most easily observed and monitored. This rebalancing hit a hiccup earlier this year as the exceptionally warm winter caused American refineries to switch early and aggressively from producing distillates (which encompass fuel oil, diesel and kerosene) used for heating to making more gasoline (petrol). The result has been soaring gasoline inventories that have depressed refinery margins, causing them to process less crude ... which has fed back in the form of a lower oil price.

That process should reverse as we head for the autumn and then into winter, Medley believes, as refineries shift back to producing distillates. And while distillate inventories are high by historical standards, they are in better shape than gasoline stocks. The key to what happens next is what kind of winter we will get in the US and the northern hemisphere in general.

A big part of the unseasonably warm winter in 2015/16 was due to the strongest El Niño effect in the past 40 years, as measured by the rise in water temperatures in the equatorial Pacific. This tends to have a warming effect across the globe.

Notably, a strong El Niño tends to be followed by a strong La Nina, during which cool water wells back up into the Pacific and reverses everything. This happened in the early 1980s, the mid-1990s and most recently when a warm 2009/10 was followed by a very cold northern winter in 2011/12 — boosting demand for heating fuel and thus running down inventories and pushing up prices.

Forecasting the weather is hardly a sound investment strategy. But coupled with all the other factors discussed above, it suggests that crude oil could be entering a more stable trading range of $50-$70/barrel rather than falling back below $50 again for a significant period. Not only would that please the Saudis, it also suggests significant upside for investors compared with what is currently priced into the market.

-----

Earlier: 

OIL PRICES: ABOUT $49 

OIL PRICES: $49.39 

NERVOUS OIL PRICES 

OIL PRICES: $50 

SHAKY MARKET BALANCE

 

 

 

Tags: OIL, PRICES
PRICE CAN BE STRONGER October, 19, 11:30:00

ТРАГЕДИЯ В КЕРЧИ

PRICE CAN BE STRONGER October, 19, 11:25:00

OIL PRICE: NOT ABOVE $80

PRICE CAN BE STRONGER October, 19, 11:20:00

GAS FOR CHINA: THE BIGGEST

PRICE CAN BE STRONGER October, 19, 11:15:00

RUSSIAN LNG FOR GERMANY

PRICE CAN BE STRONGER October, 19, 11:10:00

RUSSIAN YAMAL LNG

PRICE CAN BE STRONGER October, 19, 11:05:00

EXXON'S LNG FOR CHINA

All Publications »

Chronicle:

PRICE CAN BE STRONGER
2018, October, 19, 11:00:00

NORWAY'S GAS FOR BRITAIN

PLATTS - Norwegian natural gas exports to the UK jumped to their highest in six months Wednesday as consistently high UK prices incentivized flows normally only reserved for wintry periods.

PRICE CAN BE STRONGER
2018, October, 19, 10:55:00

UZBEKISTAN'S NUCLEAR: $11 BLN

AZERNEWS - The estimated cost of construction of nuclear power plant of Russian design in Uzbekistan will be about $ 11 billion, the launch of the first power unit has been planned for 2028, the Aide to the President of the Russian Federation Yury Ushakov said.

PRICE CAN BE STRONGER
2018, October, 19, 10:50:00

IRANIAN GAS: 1 BLN CMD

SHANA - Managing Director of the Iranian Gas Engineering and Development Company (IGEDC) Hassan Montazer Torbati said the supply of one billion cubic meters per day of natural gas by National Iranian Gas Company (NIGC) was one of the goals of the company by 2021.

PRICE CAN BE STRONGER
2018, October, 19, 10:45:00

CHINA - BELGIUM NUCLEAR

WNN - China and Belgium have signed a framework agreement on cooperation in the peaceful use of nuclear energy. The agreement was one of several accords signed in Brussels yesterday during a meeting between Chinese Premier Li Keqiang and Belgian Prime Minister Charles Michel.

All Publications »