CL=F - Crude Oil Nov 19
| Pre. Settlement | N/A |
| Settlement date | 2019-10-22 |
| Open | 54.09 |
| Bid | 53.35 |
| Last price | 53.93 |
| Day's range | 53.35 - 54.62 |
| Volume | 156,871 |
| Ask | 53.76 |
- Bloomberg
Saudi Arabia's Best Bet Is to Crash the Price of Oil
(Bloomberg Opinion) -- Saudi Arabia should give up trying to manage the global crude market and return to the pump-at-will policy it briefly adopted in 2014 under its longest serving oil minister Ali Al-Naimi.In the mercantilist world in which we now live, where decisions are based on narrow national interest, it makes no sense for the world's lowest-cost oil producer to subsidize shale and prop up other high-cost suppliers.Of course when it does, oil prices will crash just as they did in 1986 when the country finally abandoned fixed official selling prices. And then, in the aftermath, global investors will get in a flap about all things Saudi: the IPO of the kingdom’s state oil company, the financing required to fund a young and under-employed population, Mohammed bin Salman’s ambitious Vision 2030 plan to transform the economy away from its dependence on oil.Despite the risks, it’s time to admit that market management is failing, even though Saudi Arabia and it “allies” say that it isn’t.The OPEC+ agreement was meant to drain excess stockpiles in six months. But we are now approaching a fourth year of Saudi Arabia leading a global alliance of producers in trying — and failing — to push up oil prices in a sustainable way.For a while it appeared that the cuts were having the desired effect. Inventories came down and Brent prices rose from about $45 a barrel in June 2017 to reach a high of $86 in October 2018. But they swiftly fell back towards $50 and a second round of cuts that began in January has failed to keep them above $60. Even the temporary loss of more than half of Saudi Arabia’s oil production — and most of the world’s spare capacity — in an attack on two of the kingdom’s biggest processing facilities failed to lift prices for more than a few days.The latest data from OPEC itself — along with the International Energy Agency and the U.S. Energy Administration — show the failure of the policy. All three see global oil inventories building in the first half of next year in the face of what is starting to look like America's forever trade war. The global gridlock has also prompted a reduction in forecasts for growth in oil demand this year and next. The average level of Saudi oil production in the first eight months of 2019 was the lowest since 2014 — even excluding the dip caused by the Sept. 14 attacks on the kingdom’s oil processing infrastructure. And it will have to come down further next year if the kingdom wants to continue trying to manage the market.Meanwhile Russia, the kingdom’s leading partner in the OPEC+ group of countries that came together to manage supply, has seen its output continue to rise each year, even as it has come to dominate OPEC+ policymaking.Saudi Arabia should let American shale drillers take the strain. After all, aren't they the producers of the marginal barrel of crude now? As long as Saudi Arabia and its cohorts continue to restrict output and subsidize shale they are merely delaying an answer to the question.It’s time to discover a true price of oil.Saudi Arabia will learn to work with this over time, just as it did after 1986. And it will probably find that that price isn’t as low as the kingdom fears. Eventually, shale producers will be forced to cut back — or they won’t.If they are forced to cut, then Saudi Arabia will get the price support it craves, without having to lower its own output. But if shale production can just keep going up and up, even in a lower-price environment, then it proves just as emphatically that the Saudi-led policy of market management is a busted flush anyway.Will they do it? I doubt it.Current oil minister Abdulaziz Bin Salman sees it as his job “to ensure that the oversupply doesn’t continue.” December’s OPEC and OPEC+ meetings will likely yield the promise of further output cuts and Saudi Arabia will pump even less next year in a vain attempt to prop up prices. But it would be nice to believe that they are capable of change.To contact the author of this story: Julian Lee at jlee1627@bloomberg.netTo contact the editor responsible for this story: Melissa Pozsgay at mpozsgay@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Julian Lee is an oil strategist for Bloomberg. Previously he worked as a senior analyst at the Centre for Global Energy Studies.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
- Market Realist
EIA Inventory Data: Will Natural Gas Decline Further?
EIA inventory data showed a buildup of 104 Bcf (billion cubic feet) in natural gas inventories. The EIA reported the natural gas inventory on October 17.
- FX Empire
AUD/USD Forex Technical Analysis – Short-Squeeze Could Take Aussie to .6863 into Close
Given the current upside momentum, the next upside target into the close is .6863. The AUD/USD could pause at this price, but also accelerate into .6879. This is the last potential resistance angle before the .6895 main top.
- FX Empire
Natural Gas Price Fundamental Daily Forecast – Short-Covering Fueled by Expectations of Cold Temperatures
The main trend is down, but momentum has been trending higher since October 11, following the formation of the closing price reversal bottom at $2.388. Look for an upside bias on a sustained move over $2.478, and for an acceleration to the upside if buyers can take out $2.564 and $2.568. A downside bias will develop if $2.478 fails.
- FX Empire
Crude Pauses After Punching Above $54
Crude prices have leveled off on Friday. Crude took advantage of dollar weakness on Thursday, climbing 2.0 percent.
- Reuters
Adani awards rail contract to support Australian thermal coal mine
India's Adani Enterprises has awarded a contract to an Australian rail company as the conglomerate steps up infrastructure spending to support its new thermal coal mine in Queensland state. The A$100 million ($68.30 million) contract was awarded to privately held Martinus Rail, based in the regional city of Rockhampton, Adani said in a statement on Friday. Adani Mining Chief Executive Lucas Dow said more than A$450 million worth of contracts had already been awarded on the Carmichael Project, the majority to regional Queensland areas.
- FX Empire
US Stock Market Overview – Stock Rise Driven by Healthcare; Energy Shares Slip
While most of the financial have beat the street, technology shares have been less upbeat. IBM reported earnings on Wednesday after the closing bell that were weaker than expected while Netflix beat but the number of new users missed expectations. CSX reported better than expected earnings and painting an upbeat picture of the US economy.
- Oilprice.com
Trump’s Impossible Biofuel Dilemma
The Trump administration has been in the middle of a constant battle between farmers and the oil industry over the ethanol market, and both sides are fed up of the President’s broken promises
- FX Empire
Crude Oil Price Forecast – Crude Oil Markets Finding Support
The crude oil markets went back and forth during the trading session on Thursday, as we have gotten the inventory figures out of the way. There is structural support underneath, so it does look like the buyers are still around.
- Oilprice.com
Oil Nosedives As EIA Confirms Huge Inventory Build
Oil prices fell on Thursday as the EIA confirmed a large crude oil build for the week ending October 11
- Reuters
Palm oil body to wield stick to get consumer goods giants to go green
A palm oil industry watchdog will adopt rules next month that will impose fines on consumer goods companies like Unilever and Nestle if they don't start buying more green palm oil to help curb deforestation in Southeast Asia, the regulating body said. Producers of palm oil, a commodity used in everything from ice cream to lipstick, are blamed for destroying millions of hectares of forest in Southeast Asia, in part by using slash-and-burn techniques that blanketed Singapore, Malaysia and Indonesia in smog in September. The growers, though, say palm oil buyers like Unilever , Nestle , Procter & Gamble Co and PepsiCo share responsibility because they don't buy enough sustainably produced oil, undermining efforts to reward those who adopt greener practises and reduce deforestation.
Oilprice.comAPI: Supersized Crude Build Sends Oil Prices Down
The American Petroleum Institute has estimated a major crude oil inventory build of 10.45 million barrels, nearly 8 million barrels more than estimated
- Oilprice.com
A Draconian Crackdown Looms Over Natural Gas
Natural Gas is coming up against increasingly strong resistance from environmental activists and the public in general, leading some to question whether it will face the same fate as coal
- Oilprice.com
Mammoth Oil Field Hit Hard By Unplanned Production Cuts
One of the world’s largest offshore oil fields has lost 80,000 barrels per day of production due to unplanned maintenance
- Oilprice.com
Iran Claims To Have Video Evidence Of Oil Tanker Attacks
An Iranian National Security official claims to have evidence that Saudi Arabia, Israel and the U.S. were responsible for the attack on Iran’s oil tanker
- Bloomberg
California Fuel Tank Fire Contained and Shipments Halted
(Bloomberg) -- A fire at a San Francisco-area fuel terminal is contained after spewing black smoke high in the air, snarling rush-hour traffic and prompting officials to ask residents to take shelter.Authorities are working to assess any health threat from the fire that affected two tanks at NuStar Energy LP’s Selby Terminal in Crockett, about 25 miles (40 kilometers) northeast of San Francisco, the Contra Costa Country fire department said on Twitter. The tanks held “very low volumes of ethanol” comprising less than 1% of their capacity, NuStar said.All operations have been suspended, and product shipments in and out of the facility are halted. All personnel are safe, the company said.NuStar’s shares fell 0.8% to $28.11 at 2:59 p.m. in New York on Wednesday.An order for residents to remain indoors has been lifted for all affected areas near the NuStar facility, the Contra Costa County Health Department said in a tweet. Since there is no longer any imminent danger to the public, a section of Interstate 80 near the terminal that had been closed in both directions has now re-opened, the California Highway Patrol said in a tweet.The blaze came less than a day after an earthquake forced Marathon Petroleum Corp. to shut units at its nearby Martinez refinery, threatening to push up gasoline prices that had just eased from the highest level in seven years. Disruptions at California refineries sent retail pump prices in the state well above $4 a gallon.The fire involved two tanks. Three others, holding ethanol and jet fuel, were checked for structural damage, found to be sound and then were vented, Steve Hill, a spokesman for the Contra Costa Fire Protection District, said at a televised news conference on Wednesday.Hill said new, smaller tanks were delivered by NuStar to collect a combination of waste ethanol, water and up to 15,000 gallons of fire-retardant foam from ponds near the burned tanks. He also said the small amount of product in storage had benefited the firefighting effort."We have dodged some bullets in the last 24 hours," Hill said. "Yes, those tanks were almost empty, but that also means they had extra amounts of oxygen inside."Hill said alternate piping was being installed to replace damaged equipment and reconnect the terminal to Northern California oil supply. He said a terminal contractor was briefly trapped in a nearby culvert Tuesday night before he was rescued.The two burned tanks contained a combined 250,000 gallons of ethanol. The blaze had spread to 15 acres of nearby vegetation. Between 12 and 20 nearby residents were evacuated.The incident comes a week after the state’s utility PG&E Corp. shut power to 738,000 homes and businesses to prevent wildfires similar to those that devastated the state last year, causing dozens of fatalities.Phillips 66, whose Rodeo refinery is less than a mile away, has not been impacted, Dennis Nuss, a company spokesman, said Wednesday. NuStar operates about 9,800 miles of pipeline and 74 terminal and storage facilities that store and distribute crude oil, refined products and specialty liquids. Its San Francisco-area facility has a capacity of about 3 million barrels of gasoline, diesel, jet fuel and ethanol, according to the company’s website.(Updates fourth paragraph with share price, seventh paragraph onward with details on the incident.)\--With assistance from Ann Koh, Natnicha Chuwiruch, Bill Lehane and Brian Eckhouse.To contact the reporters on this story: Robert Tuttle in Calgary at rtuttle@bloomberg.net;Jeffrey Bair in Houston at jbair4@bloomberg.netTo contact the editors responsible for this story: David Marino at dmarino4@bloomberg.net, Jessica Summers, Mike JeffersFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Oilprice.com
Russia Nears 100% Compliance With Oil Production Target
Russia is finally nearing 100% compliance with the OPEC+ production cut deal, a significant milestone for the energy giant
- Oilprice.com
Oil Prices Jump On A Lone Piece Of Bullish News
Oil prices rose on Wednesday on news that OPEC and its allies may be preparing to deepen their production cuts by the end of the year
- Reuters
Explainer: Translating TOR - How Brazil's $26 billion oil rights auction works
Brazil's Senate passed the main text of a bill late on Tuesday defining the distribution of proceeds from a blockbuster auction of oil prospecting rights, a key milestone for the enormous offshore region known as TOR - the 'transfer-of-rights' area. The bidders who win exploration and production rights in the massive Nov. 6 auction will be obliged to pay the government a combined signing bonus of some 106.5 billion reais ($25.8 billion), making it the largest oil bidding round in history, according to Brazilian authorities. The fields are unique as Brazilian state-run oil firm Petroleo Brasileiro SA, better known as Petrobras, has already done significant exploration work in the area.
- FX Empire
Futures Fall Despite Solid EPS, Retail Sales Miss, Brexit Deal Remains Elusive
The earnings-driven rebound stalls as concerns over the Phase I trade deal begin to take center stage.
- Reuters
U.S. 'deeply concerned' about untrackable China ships carrying Iran oil: officials
The White House is warning Chinese shipping companies against turning off their ships' transponders to hide Iranian oil shipments in violation of U.S. sanctions, two senior administration officials said. "We've been messaging very heavily to the shipping companies, you don't want to do this, it's not worth it," said one official, who spoke to Reuters on condition of anonymity. China is the largest remaining buyer of Iranian oil after U.S. President Donald Trump reimposed sanctions on Tehran's main export.
- Investing.com
Oil Slips Further Below $59 amid Worries over Demand Outlook
Investing.com - Oil prices slid further below the $59 a barrel level on Wednesday, pressured by ongoing concerns over the global demand outlook, as energy traders awaited inventory data for fresh insights on the supply side.
