Crude Oil....

[waltky]

You can bet the Russians will be against anything that balances out oil prices...

IEA says oil market may rebalance faster if OPEC sticks to target
Tue Oct 11, 2016 | Global oil supply could fall in line with demand more quickly if OPEC and Russia agree to a steep enough cut in production, but it is unclear how rapidly this might happen, the International Energy Agency said on Tuesday.

OPEC, led by Saudi Arabia, agreed last month to cut production to around 32.5 to 33 million barrels per day (bpd) and Russia has signaled it is ready to join in any effort to temper supply and shrink a stubborn global surplus of unwanted crude. Oversupply helped send oil prices from $115 a barrel in June 2014 to as low as $27 in January this year. Crude has since recovered to around $50 on expectations of a production cut.

The IEA said in its August report it expected world oil demand to grow at a rate of 1.2 million bpd next year, keeping its forecast unchanged from last month, but cut its estimate of growth in 2016 by 40,000 bpd to around 1.2 million bpd, from around 1.3 million bpd last month. "Even with tentative signs that bulging inventories are starting to decline, our supply-demand outlook suggests that the market -- if left to its own devices -- may remain in oversupply through the first half of next year," the IEA said. "If OPEC sticks to its new target, the market's rebalancing could come faster." "At this stage, it is difficult to assess how the OPEC supply cut, if enforced, will affect market balances," the agency added. "A significant rebound in production from Libya and Nigeria and further growth from Iran would suggest that bigger cuts would have to be made by others, such as Saudi Arabia, to meet the ... production target."

A person carrying an umbrella walks by the Ogranization of the Petroleum Exporting Countries (OPEC) headquarters in Vienna, Austria​

OPEC members meet next month in Vienna. Iran is recovering market share after years of Western sanctions, in Libya, civil unrest has cut production and a series of attacks on oil infrastructure have curtailed Nigerian supply. All three are expected to be exempt from any coordinated cuts, meaning that the onus will likely rest on some of the higher-producing members, such as Saudi Arabia and Iraq. The IEA forecast a decline of 900,000 bpd in non-OPEC output in 2016 to 56.6 million bpd, and expects a rise of 400,000 bpd in 2017.

Global stockpiles fell for the first time since March, down 10 million barrels to 3.092 billion barrels, just shy of July's record 3.111 billion barrels. "The fall in stockpiles was largely driven by crude, which fell in all OECD regions and especially sharply in Asia Oceania. This brought crude stocks back to early February levels. Refined product stocks across the OECD hit yet another historic high as refineries increased runs in August," the IEA said. The agency said global demand growth has continued to slow after hitting a five-year high of 2.5 million bpd in the third quarter of last year, to a four-year low of 800,000 bpd in the third quarter of this year, due to "...vanishing OECD growth and a marked deceleration in China."

IEA says oil market may rebalance faster if OPEC sticks to target

See also:

Russia's Rosneft boss Sechin says no to OPEC oil cap
Tue Oct 11, 2016 | Igor Sechin, Russia's most influential oil executive and the head of state-controlled energy giant Rosneft (ROSN.MM), said his company will not cap oil production as part of a possible agreement with OPEC.

His comments underline how difficult it is for Russia to get its oil companies to freeze or cut output as part of a potential deal with the Organization of the Petroleum Exporting Countries designed to support oil prices. President Vladimir Putin told an energy congress on Monday that Russia was ready to join a proposed OPEC cap but did not provide the details. "Why should we do it?" Sechin, known for his anti-OPEC position, told Reuters in Istanbul on Monday evening, when asked if Rosneft, which accounts for 40 percent of Russia's crude oil output, might cap its production.

Earlier on Monday, Sechin told reporters that Rosneft planned this year to raise its oil production, already the world's largest among listed producers, above the 203 million tonnes (4.1 million barrels per day) it produced in 2015. Sechin said he doubted some OPEC countries, such as Iran, Saudi Arabia and Venezuela, would cut their output either: "Try to answer this question yourself: would Iran, Saudi Arabia or Venezuela cut their production?" OPEC's oil output is likely to reach its highest in recent history in September, as Iraq boosted northern exports and Libya reopened some of its main oil terminals.

FUTILE ATTEMPTS

There have been several attempts in the past for Russia and OPEC to join forces to stabilize oil markets. Those efforts have never come to fruition, however. Russia's oil industry has argued for years that it cannot cut output to support falling global prices for purely technical reasons linked to the climate in Siberia; in reality it can - as long as it has the political will. Putin could in theory force companies to cut their production or postpone the launch of new oilfields.

Head of Russian state oil firm Rosneft Igor Sechin attends a session of the St. Petersburg International Economic Forum 2016 (SPIEF 2016) in St. Petersburg, Russia​

Russia was already pumping at the post-Soviet record high of 11.1 million barrels per day in September thanks to a recovery in oil prices which triggered exploration drilling activity. "Given the propensity of OPEC and other producers to talk up prices, and the history of failed deals among OPEC and between OPEC and Russia, we would continue to treat the news somewhat carefully for the longer term," Sberbank CIB said in a note. The Russian oil landscape is dominated by a handful of players -- second-biggest firm, private Lukoil (LKOH.MM), private producer Surgut (SNGS.MM), state-owned Gazprom Neft (SIBN.MM) and Tatneft (TATN.MM).

The companies plan to raise production by about 1.6 percent on average in 2017, according to their forecasts and Reuters calculations as they benefit from a weaker rouble and cheaper costs at home. Sechin has long argued that any oil price increase as a result of joint actions by OPEC and non-OPEC members will allow the United States to resume production growth from high-cost shale deposits. "The Americans want it most ($50 per barrel) as the shale oil projects become profitable with such a price. And $60 (per barrel) will result in more shale oil projects," Sechin told Reuters.

http://www.reuters.com/article/us-oil-opec-russia-sechin-idUSKCN12B0J1[/quote]​

 

[M14 Shooter]

If the crude oil is formed through compression, just as diamonds are, there must be a way to be able to manufacture some form of compression agent that will 'compress' the ingredients of crude oil to manufacture crude oil.

This technology has been around for quite some time, the results of which can be found in your grocers' baking aisle.

 

[waltky]

Iran cheers OPEC deal on limiting output...

Iran: OPEC deal on limiting output step in right direction
October 17, 2016 — Iran's deputy oil minister says a preliminary agreement by OPEC nations to limit output to between 32.5 million and 33 million barrels per day is a "small step, but in the right direction."

Amir Hossein Zamaninia spoke Monday in Tehran, after the Organization of Petroleum Exporting Countries reached the deal in late September. The limit is meant to reduce a global glut that has depressed oil prices for over two years.

Iran had resisted cutting production. It's trying to restore its oil industry since emerging from international sanctions over its nuclear program earlier this year.

Zamaninia says Iran's oil output is 3.85 million barrels per day. Iran has said previously it would only consider a possible ceiling on output after it reaches 4 million barrels per day, its pre-sanctions level.

Iran: OPEC deal on limiting output step in right direction

 

[RoshawnMarkwees]

Iran cheers OPEC deal on limiting output...

Iran: OPEC deal on limiting output step in right direction
October 17, 2016 — Iran's deputy oil minister says a preliminary agreement by OPEC nations to limit output to between 32.5 million and 33 million barrels per day is a "small step, but in the right direction."

Amir Hossein Zamaninia spoke Monday in Tehran, after the Organization of Petroleum Exporting Countries reached the deal in late September. The limit is meant to reduce a global glut that has depressed oil prices for over two years.

Iran had resisted cutting production. It's trying to restore its oil industry since emerging from international sanctions over its nuclear program earlier this year.

Zamaninia says Iran's oil output is 3.85 million barrels per day. Iran has said previously it would only consider a possible ceiling on output after it reaches 4 million barrels per day, its pre-sanctions level.

Iran: OPEC deal on limiting output step in right direction

Any reasonable person knows that what is good for Iran's criminal regime is bad for civilization.

 

[waltky]

Oil producers close to output cap deal...

Venezuela's Maduro says oil producers close to output cap deal
Sat Oct 22, 2016 | Venezuelan President Nicolas Maduro was quoted on Saturday as saying that OPEC and non-OPEC nations were "very close" to an agreement on oil production curbs, Azerbaijan's state news agency Azertag reported.

"Today with (Azeri) President Ilham Aliyev we talked about reaching agreements between OPEC and countries that are not members of the cartel. We are very close to reaching agreements and signing a relevant deal," Azertag quoted Maduro as saying in Baku, Azerbaijan's capital city. "I believe that the relevant agreement will be reached within a very short time and we will announce it. This will pave the way for a new era of stability and investments, stable output and new oil price formula," he said. Maduro later visited Iran and discussed issues including the oil market with Supreme Leader Ayatollah Ali Khamenei and President Hassan Rouhani.

An oil pump is seen in Lagunillas, Venezuela​

Ayatollah Khamenei told Maduro that a fall in oil prices was a "tool for pressuring countries that are independent of the United States", the Islamic republic's arch-enemy, Iranian state media reported. "Through wise policies and increased cooperation, it is possible to defeat such plots and enmity," state broadcaster IRIB quoted Khamenei as saying. Rouhani told Maduro that "Iran supports any action in line with the stability of the oil market, a fair price and a fair share (of production)," IRIB reported on its website.

Maduro visited Azerbaijan and Iran as part of an international trip that also includes visits to Saudi Arabia and Qatar and is aimed at pushing a deal to stabilize oil markets. The Organization of the Petroleum Exporting Countries (OPEC) agreed in Algiers on Sept. 28 to reduce production to a range of 32.5 million to 33.0 million barrels per day, which would be its first output cut since 2008. Another meeting on Nov. 30 is set to firm up details of the accord. Azertag also quoted Aliyev as saying Azerbaijan would not increase oil production and exports, reinforcing the statement he made last week.

Venezuela's Maduro says oil producers close to output cap deal

 

[waltky]

Iraq keeps OPEC production cut at bay...

Oil prices drop as Iraq says doesn't want to join OPEC cut
Oct 23 2016 - Oil prices fell early on Monday as Iraq said it wanted to be exempt from any deal by producer cartel OPEC to cut production to prop up the market, and as U.S. drillers stepped up work.

Brent crude futures LCOc1 were trading at $51.59 per barrel at 0133 GMT, down 19 cents, or 0.4 percent, from their last close. U.S. West Texas Intermediate (WTI) crude was down 22 cents, or 0.4 percent, at $50.63 a barrel. Traders said the price falls followed comments from Iraq, which said it wanted to be exempt from a production cut by the Organization of the Petroleum Exporting Countries (OPEC) that the group plans to decide at its Nov. 30 meeting. OPEC plans to reduce production to a range of 32.50 million to 33.0 million barrels per day (bpd), down from 33.39 million bpd in September.

That would be harder to achieve if Iraq, which is OPEC's second-biggest producer after Saudi Arabia, didn't participate. Iraq said on Sunday that its oil production stood at 4.774 million bpd, with exports standing at 3.87 million bpd. "We are not going back in any way, not by OPEC not by anybody else," said Falah al-Amri, the head of Iraq's State Oil Marketing Company. "Comments by Iraq over the weekend that it may not join the OPEC agreement to cut production could see oil prices come under pressure in today's session," ANZ bank said on Monday.

Flames emerge from a pipeline at the oil fields in Basra, southeast of Baghdad, Iraq​

Also pressuring the market, U.S. oil rigs rose by 11 last week, the first double-digit increase since August. [RIG/U] "We should see rig counts continue to increase in the wake of the recent price rally," Morgan Stanley said. Ongoing strength in the dollar .DXY, which can crimp demand as it makes fuel purchases more expensive for countries using other currencies at home, also weighed on oil. On the demand side, Japan's crude imports fell 4.6 percent in September from the same month a year earlier, to 3.27 million bpd, official data showed on Monday.

Despite Monday's lower prices, analysts said that oil markets, which have been dogged by two years of oversupply, might be rebalancing in terms of production and consumption. "Statistical balances suggest that conditions have improved markedly. We suspect that the market is moving more quickly into balance than is generally recognised," Barclays bank said in a note to clients on Sunday. "The market moved into a small deficit in Q3, will remain so in Q4 and then the deficit will expand significantly in 2017," it added.

Oil prices drop as Iraq says doesn't want to join OPEC cut

 

[waltky]

Sputtering global economy means faltering demand for oil...

Oil Prices Waver, Rise in Turbulent and Complex Market
October 27, 2016 - Oil prices have been bouncing up and down recently, as a sputtering global economy meant faltering demand for energy. The balance between crude oil supplies and energy demand has been rattled further by surging competition from wind and solar energy, a deal to limit production by members of the Organization of Petroleum Exporting Countries, and unrest in some key oil-producing nations.

A U.S. government analyst says "global supply has far exceeded global consumption," for the past year and a half, but that gap is narrowing. Hanna Breul of the Energy Department's Energy Information Agency says that as the supply surplus diminishes, prices rise. Prices are likely to continue rising in the short term, she says, while demand for oil will grow well into the future.

Weighing oil supply and demand is complicated. For example, U.S. oil output surged in recent years due to expanding shale oil production, contributing to a glut that hurt prices. Breul says shale oil production needs continued drilling and investment to be productive. Low oil prices dried up money for such oil operations, and that cut U.S. production. Faltering U.S. oil production made it necessary to bring more crude oil into the country, and oil imports reached a six-year high recently.

OPEC deals

These market gyrations come at the same time as members of the OPEC cartel say they have worked out a deal to cut oil production to boost prices. Prices fell from about $100 a barrel a couple of years ago to less than $30, which caused serious problems for oil companies and nations dependent on oil exports for revenue. OPEC pumps about one-third of the world's petroleum, and news that OPEC members and some other major oil producers might agree to limit output pushed prices back up to around $50 a barrel on global markets recently. The OPEC cartel is scheduled to meet in late November to work out details of their agreement to cut production, including the difficult negotiation on which nations will cut how much. Several OPEC nations, including war-torn Iraq, are asking for exemptions to quota cuts.

Khalid al-Falih, Minister of Energy, Industry and Mineral Resources of Saudi Arabia, answers questions as part of the 15th International Energy Forum Ministerial meeting in Algiers, Algeria​

Nevertheless, after a recent meeting with top OPEC officials, Russia's Energy Minister Alexander Novak said, "Ahead of OPEC taking its final decision, we are working out different options and mechanisms of OPEC and non-OPEC countries participation in finding out joint agreements." Saudi minister of Energy, Industry, and Mineral Resources Khalid Al-Falih said he is "optimistic" the oil market will "continue to improve."

Surge in solar, wind

While oil producers may be working out an agreement, their competitors are also very busy. The International Energy Agency says there was a surge in the number of solar energy installations with half a million solar panels going in each day in 2015. Wind energy facilities also increased with two wind turbines installed every hour during the year. The IEA says the cost of producing electricity from wind has fallen by one third since 2010, while solar electricity costs dropped even more. The IEA called the changes "transformational."

Oil Prices Waver, Rise in Turbulent and Complex Market

 

[waltky]

Another OPEC meeting to try and raise oil prices...

Amid low crude prices, world oil officials meet in Abu Dhabi
Nov 7,`16 -- Leading oil officials from around the world meeting in Abu Dhabi remain tense over low crude prices, though they are trying to sound optimistic.

That's in contrast to last year's Abu Dhabi International Petroleum Exhibition & Conference, which had a more-upbeat tone. Monday's event started with the officials acknowledging the pinch of low oil prices, now around $50 a barrel, down from over $100 in mid-2014.

An Emirati journalist films the audience as OPEC Secretary-General Mohammad Sanusi Barkindo of Nigeria gives a speech at the annual Abu Dhabi International Petroleum Exhibition & Conference in Abu Dhabi, United Arab Emirates, on Monday, Nov. 7, 2016. Those attending the onference this week remain worried about low global oil prices.​

OPEC Secretary-General Mohammad Sanusi Barkindo of Nigeria warned those prices were cutting into development of new fields. ExxonMobil CEO and chairman Rex W. Tillerson says: "We don't need any more uncertainty."

But with U.S. shale oil posed to re-enter the market if prices rise much higher and OPEC members still with high production, the uncertainty and lower prices may continue.

News from The Associated Press

 

[waltky]

Oil goes up $2.50/bbl.

Oil Rallies On Renewed OPEC Cut Hopes
Nov 15, 2016 - After a strong sell-off in recent days, option expiry combines with OPEC cut expectations to emphatically rally prices on this third Tuesday in November. Hark, here are five things to consider in oil markets today:

1) We said in the aftermath of the Algiers meeting that if an OPEC production cut were to be forthcoming, Saudi Arabia would have to do the heavy-lifting. A production cut still appears a likely scenario, as does some back-breaking work by Saudi. With the OPEC meeting in Vienna in fifteen days, the cartel is entering the final stretch of diplomacy, via the medium of closed-door meetings. The situation for OPEC has only become more complicated since the end of September, however.

Libyan oil production is on the rise, exhibited via their increased exports both this month and last (hark, at 550,000 bpd so far in November, according to our ClipperData). And despite reports of a renewed surge in sabotage in Nigeria, export loadings have clambered above 2 million barrels per day so far in November. Exports for the two are up over 1mn bpd compared to September:

2) Rising OPEC production means that the cartel is going to have to dig even deeper in terms of production cuts. At the time of the Algiers meeting, the latest data showed OPEC producing 33.237mn bpd. Last week's November report from OPEC pegged production at 33.64mn bpd - a record.

This is reflected in the middle bar below; the cartel has to cut by at least 0.64mn bpd, or by 1.14mn bpd, depending upon the production target they choose (32.5mn bpd or 33mn bpd). Including a rebound in Angolan production (as well increasing flows from Libya and Nigeria, as highlighted above), the cartel is going to have to cut by an even larger amount.

MORE

See also:

Oil Prices Resilient Despite API Reported Crude Inventory Build
Nov 15, 2016 - A larger than expected build in United States crude inventories caused West Texas Intermediate prices to fall slightly after the American Petroleum Institute’s weekly supply report hit the press Tuesday afternoon.

Crude inventories were up 3.65 million barrels. Supplies at the Cushing, Oklahoma, storage site saw the biggest increase since August, storing 1.13 million barrels more than last week. According to Zerohedge, experts expected the build to equal just 150,000 barrels. Distillates jumped by almost 3 million barrels after eight weeks of consistent draws.

The only dip this week was gasoline inventories, which declined by 155,000 barrels – far less than the 1.1 million drop that industry insiders predicted. Overall, oil prices still saw a day of good returns. At the time of this article’s writing, WTI prices traded at a premium of 5.52 percent at $45.71, while Brent prices stood 5.55 percent higher at $46.88.

Last week – just a few hours after Donald Trump won the presidential election - the Energy Information Administration (EIA) reported a build of 2.4 million barrels of crude in U.S. commercial inventories. The latest API report will either be confirmed or denied by tomorrow’s official EIA figures.

After the Republican win, benchmark oil prices quickly recovered the losses registered on voting day, and even started climbing up. Trump has vowed to make the United States energy independent by cutting off access to foreign sources of oil, while promising a go-ahead for the Keystone XL pipeline and new clean coal and shale projects.

Oil Prices Resilient Despite API Reported Crude Inventory Build | OilPrice.com

 

[RoshawnMarkwees]

Let's hope Trump keeps his word and OPEC loses much of its leverage.

 

[JakeStarkey]

Rosh, there is not much of anything Trump can do about OPEC, despite campaign promises.

 

[RoshawnMarkwees]

Rosh, there is not much of anything Trump can do about OPEC, despite campaign promises.

Bullshit. All he has to do is reverse the restrictions obama reimposed.

 

[JakeStarkey]

Nope, that will change nothing. It means there is even more oil. OPEC will pump in competition. Nothing changes.

The change needs to come with an agreement by Russia, Saudi Arabia, and Iran. Good luck on that.

 

[RoshawnMarkwees]

Nope, that will change nothing. It means there is even more oil. OPEC will pump in competition. Nothing changes.

The change needs to come with an agreement by Russia, Saudi Arabia, and Iran. Good luck on that.

Wrong. US increased supply leverages global supply and reduces OPEC leverage. That is why fracking forced the price down. Offshore drilling replaces fracking in a more cost-effective and efficient way. That is why prices were so low in the months leading to Obama's reign.

 

[JakeStarkey]

Nope, that will change nothing. It means there is even more oil. OPEC will pump in competition. Nothing changes.

The change needs to come with an agreement by Russia, Saudi Arabia, and Iran. Good luck on that.

Wrong. US increased supply leverages global supply and reduces OPEC leverage. That is why fracking forced the price down. Offshore drilling replaces fracking in a more cost-effective and efficient way. That is why prices were so low in the months leading to Obama's reign.

You really do not understand, do you? OK. What you are writing above is only a small portion of what is going on. But, be as that may, you will show yourself a silly yet once again.

We can wait on OPEC to figure out. Obama and then Trump will have no real influence on OPEC.

 

[waltky]

Means oil prices goin' up...

Major indexes hit records as post-election rally goes on
November 21, 2016 - All three major U.S. stock indexes set record closing highs on Monday, extending their post-election rally as energy and other commodity-related shares gained and Facebook led a jump in technology.

Small caps added to recent gains as well, pushing the Russell 2000 index <.RUT> to a record high close. The session marked the first time all four indexes hit closing records since Dec. 31, 1999. Stocks have mostly rallied since the Nov. 8 U.S. election, with investors snapping up shares of banks, health care and other companies expected to benefit from President-elect Donald Trump's policies.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, NY​

The energy index <.SPNY> jumped 2.2 percent, leading gains among major S&P sectors, as U.S. oil prices jumped 3.9 percent. Hopes that the OPEC would agree to an output cut next week lifted oil prices. The S&P materials index <.SPLRCM> was up 1.3 percent. "The post-election rally is continuing," said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama. Optimism that Trump will ease regulations and reduce taxes "keeps pulling money into the market," he said. "A lot of money came out of bond funds last week into stocks, and I think that can continue given the potential spread between what stocks can do versus bonds."

Data from TrimTabs Investment Research showed investors moved $45.7 billion into U.S.-listed equity exchange-traded funds in the eight trading days ended Thursday, the biggest eight-session inflow on record. The Dow Jones industrial average <.DJI> ended up 88.76 points, or 0.47 percent, at 18,956.69, while the S&P 500 <.SPX> gained 16.28 points, or 0.75 percent, to 2,198.18 and the Nasdaq Composite <.IXIC> added 47.35 points, or 0.89 percent, to 5,368.86. The S&P 500 had last set a closing record on Aug. 15. All three major indexes hit record intraday highs as well.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, NY​

Expectations may be building that the new administration will bring tax breaks that will help corporations and consumers, said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia. But, he said, "you're betting an awful lot on something that hasn't even been introduced before Congress yet."

MORE

 

[waltky]

Gonna cause gas prices to go up here...

U.S. opens door to oil exports after year of pressure
Tue Dec 30, 2014 | The Obama administration on Tuesday bowed to months of growing pressure over a 40-year-old ban on exports of most domestic crude, taking two steps expected to unleash a wave of ultra-light shale oil onto global markets.

The Bureau of Industry and Security, or BIS, which regulates export controls, said it had granted permission to "some" companies to sell lightly treated condensate abroad. Condensate is a form of ultra-light crude. Some two dozen energy companies had asked the agency for clarification on permissible exports earlier this year, but until Tuesday those requests had been put on indefinite hold.

The BIS also released guidance in the form of frequently asked questions, or FAQs, to explain what kind of oil was generally allowed under the ban, the first effort by the administration to clarify an issue that has caused confusion and consternation in energy markets for more than a year. The two measures are clearest signs yet that the administration is ready to allow more of the booming U.S. shale oil production to be sold overseas, where drillers have said it can fetch a premium of $10 a barrel or more. They follow a year of murky messages and widespread uncertainty over what is or is not allowed under a trade restriction that critics say is a relic of a bygone age, when oil was seen as scarce after the 1970s Arab oil embargo.

An offshore oil platform is seen in Huntington Beach, California​

A domestic drilling boom of the past six years has transformed the United States into an energy powerhouse, boosting U.S. production by more than 50 percent and reversing decades of decline. Output of very light oil has been especially strong, leading to a glut that threatens to overwhelm domestic demand. The constraints helped fuel bumper profits for refiners such as Valero Energy Corp (VLO.N) and PBF Energy Inc (PBF.N), but angered drillers such as Hess Corp (HES.N) that say they were selling at a discount.

Jamie Webster, the senior director of oil markets at research firm IHS, said the FAQ "takes the leash off of (the U.S. Department of) Commerce" and signals it may take additional action on crude exports after several months of inaction. While likely to draw broad support from many quarters, the measures also open the Obama administration to attack by environmentalists and Democrats who may see it encouraging more hydraulic fracking and as a sop to big oil companies.

STEPS TO CLARIFY

 

[waltky]

Look for gas prices to go down...

Oil tumbles as output cut looks elusive; dollar sinks
November 28, 2016 - The dollar and U.S. bond yields fell on Monday as investors reversed a "Trumpflation" trade that has gripped markets since the U.S. elections, after oil prices slid on fears that producer countries meeting this week could fail to agree an output cut.

Though Brent crude futures last traded at $47.02 per barrel , almost flat on the day, prices had been down by as much as 2.0 percent in early Asian trade, following on from a 3.6 percent fall on Friday as doubts arose over whether the Organization of the Petroleum Exporting Countries would reach a deal later this week. Prospects of reduced upward pressure on inflation from oil prices, prompted investors to temper expectations for rises in U.S. interest rates, bring down treasury yields and the dollar. That gave some relief to Asian shares, which had underperformed on worries about capital flight to higher-yielding U.S markets in the weeks since Donald Trump's Nov.8 election win.

MSCI's broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> rose 0.6 percent, led by gains in Hong Kong <.HSI> and Taiwan <.TWII>. In contrast, U.S. stock futures slipped 0.2 percent after their stellar performance this month on hopes President-elect Trump's policy of fiscal spending, deregulation and protection of domestic industries will boost U.S. inflation and benefit Corporate America. Japan's Nikkei average <.N225>, which had performed even better than Wall Street thanks to the yen's fall, also lost its lustre, falling 0.3 percent. "It will be scary to think markets may fully reverse their moves since the elections, changing their mind that Trump's policy may not be so good after all," said Bart Wakabayashi, head of Hong Kong FX sales at State Street Global Markets.

Wall Street's four main indexes <.DJI> <.SPX> <.IXIC> <.RUT> all hit record highs last week, a feat last achieved in 1999. Yet some investors question whether the market may have got carried away with optimism on Trump's policy, given the uncertainty on the political neophyte's presidency, including on how closely he can work together with the Congress. But it was doubts about inflationary expectations, due to languishing oil prices that gave investors a more immediate reason to have second thoughts.

Saudi Arabia said on Friday it will not attend talks on Monday with non-OPEC producers to discuss supply cuts. "Oil prices have fallen considerably on worries about the deal. That would pressure energy shares, and could hit the entire stock markets. Given their rally in recent days, it's no surprise to see some adjustment," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management.

MORE

 

[waltky]

Will determine if crude oil prices go up...

OPEC begins debate on oil cuts amid deep disagreement
Wed Nov 30, 2016 | OPEC began on Wednesday debating a deal to curtail oil production and prop up the price of crude, with Iran and Iraq resisting pressure from Saudi Arabia to participate fully in any action.

Ministers from the Organization of the Petroleum Exporting Countries met informally at 0700 GMT at the Vienna Park Hyatt hotel and were due to begin a formal gathering at OPEC headquarters at 0900 GMT. "I'm optimistic," said Iranian Oil Minister Bijan Zanganeh, adding there had been no request for Iran to cut output. "I think we are looking at a very positive meeting," said UAE Energy Minister Suhail bin Mohammed al-Mazroui. His colleagues from Angola, Algeria and Nigeria also said they believed OPEC would reach a deal on Wednesday. Brent crude rose more than 4 percent to over $48 a barrel, after heavy losses a day earlier.

On Tuesday, Iran wrote to OPEC saying it wanted Saudi Arabia to cut production by as much as 1 million barrels per day (bpd), much more than Riyadh is willing to offer, OPEC sources who saw the letter told Reuters. The 14-country group, which accounts for a third of global oil production, made a preliminary agreement in Algiers in September to cap output at around 32.5-33 million bpd versus the current 33.64 million bpd to prop up oil prices, which have halved since mid-2014. OPEC said it would exempt Iran, Libya and Nigeria from cuts as their output has been crimped by unrest and sanctions.

A soldier patrols in front of the headquarters of the Organization of the Petroleum Exporting Countries (OPEC) in Vienna, Austria​

The deal was seen as a victory for Iran. Tehran has long argued it wants to raise production to regain market share lost under Western sanctions, when its political arch-rival Saudi Arabia increased output. In recent weeks, Riyadh changed its stance and offered to cut its output by 0.5 million bpd, according to OPEC sources, while suggesting Iran limit production at around 3.8 million bpd - in line with or slightly above the country's current output. Tehran has sent mixed signals, saying it wanted to produce as much as 4.2 million bpd. Iran's letter to OPEC suggested Saudi Arabia should cut output to 9.5 million bpd. Documents prepared for Wednesday's meeting propose the group cut production by 1.2 million bpd from October levels, an OPEC source familiar with the papers said.

The papers also propose Saudi Arabia reduce production to 10.07 million bpd from 10.54 million bpd in October and that Iran freeze output at 3.797 million bpd. Iraq has also been pressing for higher output limits, saying it needs more money to fight the militant group Islamic State. Iran and Iraq together produce over 8 million bpd, only slightly behind long-time leader Saudi with 10.5 million bpd. The argument between Iraq and Saudi Arabia mainly focuses on whether Baghdad should use its own output estimates to limit production or rely on lower figures from OPEC's experts. Some analysts including Morgan Stanley and Macquarie have said oil prices will correct sharply if OPEC fails to reach a deal, potentially going as low as $35 per barrel.

OPEC debates oil cuts amid deep disagreement

 

[Picaro]

Now we got OPEC cuttin' oil prices against each other...

Saudi Arabia Cuts Asian Oil Prices to Counter Rivals Russia, Iraq and Iran
Aug. 5, 2016 - Iraq’s oil exports to India leapfrogged Saudi Arabia’s in second quarter

Under pressure from Russian, Iraqi and Iranian oil exports, Saudi Arabia discounted its crude last weekend to maintain its share of big Asian markets. The price cut, which applies to September purchases, comes after two years of high-volume pumping by Saudi Arabia, the world’s largest oil producer. The kingdom had chosen to feed an oil glut and see prices drop rather than sacrifice sales to international rivals. But in Asia—the main source of oil-demand growth recently—Saudi Arabia has continued to lose ground. Last Sunday, it dropped its prices for Asian customers by between 70 cents and $1.30 a barrel (depending on the grade of oil), helping drive the global crude price below $42 a barrel. That was the deepest price cut since October last year. “The cuts were done to make sure Saudi Arabia remains competitive against sellers from the Middle East and Europe,” says a person familiar with the Saudi price-cut discussions.

Iraq’s Indian market share leapfrogged Saudi Arabia’s in this year’s second quarter. Iraq sold 11 million metric tons of oil to India in the quarter, a million more than Saudi Arabia, according to India’s oil ministry. That marks a reversal from last year, when Saudi Arabia’s India exports surpassed Iraq’s by 900,000 tons on a quarterly average. The shift reflects a boost in Iraqi production from new projects coming online. Iraq’s output in June was up 200,000 barrels a day from a year earlier, to 4.21 million barrels a day. In China, Saudi Arabian oil is losing ground to Russian exports that are feeding China’s burgeoning independent refineries. According to Chinese customs data, Russian crude exports to China increased by 9% to 4 million metric tons in June from a year earlier, inching closer to Saudi Arabia, whose sales fell by 14% to 4.6 million tons. Like Iraq, Russia has been ramping up output, with production of crude and condensates—liquid natural gas similar to light oil—in the second quarter rising by about 150,000 barrels a day from a year earlier to 11.03 million barrels a day, according to the Organization of the Petroleum Exporting Countries.

Saudi Arabia also is facing increased pressure from political rival Iran. Since Western sanctions were lifted in January, Iranian output has jumped by about 600,000 barrels a day to 3.64 million barrels a day in June. “Part of the weakness in Saudi Arabia is caused by crude headed to Asia from Iran,” said Jamie Webster, an adjunct research scholar at Columbia University’s Center on Global Energy Policy.

According to Vienna-based energy consultancy JBC, Iran’s combined exports to China, Japan, South Korea and India averaged 1.4 million barrels a day in the first half of 2016, up 29% year on year. That jumped to 1.7 million barrels a day in June. Iran’s shipments to India rose to 5 million metric tons in the three months to June, compared with a quarterly average of 3.2 million tons last year, according to India’s oil ministry. The Saudi price cut wasn’t entirely motivated by competition—it was also aimed at stimulating demand in China’s weakening market, said the person familiar with the government’s price-cut discussions. OPEC expects Chinese oil consumption to rise by 280,000 barrels a day this year, down from 350,000 barrels a day in 2015.

Saudi Arabia Cuts Asian Oil Prices to Counter Rivals Russia, Iraq and Iran

Their strategy is to try and bankrupt the oil shale industry here for a few years, until they can unload their own remaining reserves at higher prices in the longer term; they've come close, but there are fields here in Texas with low enough costs per barrel equivalent to raise that are competitive, and it's driving them nuts. Compound that with the announcement that yet another vast field of oil shale exists under the old oil patches in West Texas, and their strategy has backfired on them big time. Both the Euro and Asian markets are gearing up big time for LNG imports, a threat to Putin's ability to extort Europe and parts of Asia, so the Saudis and Putin are natural allies in the energy market wars against the U.S. and Europe.