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Russian oil minister Novak: oil prices are back to balanced levels

  
Analysis, Crude

Brent crude is trading at $61

The Russian oil minister Novak is on the wire saying that oil prices are back to bounce levels.  He also adds that:
  • Oil prices are stable around $60 per barrel
The price of Brent crude is currently trading at $61 per barrel. That is down $0.85 or -1.37% on the day.
WTI crude oil futures meanwhile are trading down $0.46 or -0.82% at $55.45

IEA Chief: May lower oil demand growth expectations for 2019

  
Analysis, Crude

IEA, via Reuters

IEA, via Reuters
  • IEA Chief may lower oil demand growth for 2020 if Global economy weakens further
  • Diversfying oil and natural gas imports is a natural way for Asian buyers to reduce energy security risks
  • Very lucrative time for Asian buyers to diversify gas imports as buyers have stronger hand

US Oil unfazed.

IEA, via Reuters

IEA, via Reuters
  • IEA Chief may lower oil demand growth for 2020 if Global economy weakens further
  • Diversfying oil and natural gas imports is a natural way for Asian buyers to reduce energy security risks
  • Very lucrative time for Asian buyers to diversify gas imports as buyers have stronger hand

US Oil unfazed.

Oil – more on the Aramco repairs story (could take months, not weeks)

  
Analysis, Crude
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You know how it is, your car is making a funny noise so you take it to the mechanic.

“Yeah, leave it with me, shouldn’t take long”
 
The  you get the phone call, right?
“Yeah …. this looks nasty ….”.
Same with this:
  • Oil – Aramco says repairs to Saudi plant could take many months rather than weeks
WSJ has more on it now:
  • It may take many months-rather than the maximum 10 weeks company executives have promised-to restore operations to full working order,
Journal is gated, here is the link if you can access it.

Oil – Aramco says repairs to Saudi plant could take many months rather than weeks

  
Analysis, Crude
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DJ with the report on a more pessimistic outlook for repair time compared to what the market was led to believe last week.

Oil traders might like to take note, should be a bullish input (compared to otherwise)

Crucial Update :US Dollar Index ,EURO ,YEN ,GBP ,INR ,CAD ,AUD ,PESO ,WTI ,SPX 500 -Anirudh Sethi

  
Analysis, Crude, Forex
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The Japanese yen and Canadian dollar were the only major currencies to gain against the US dollar last week.  They are also the only major currencies to appreciate against the dollar so far this year.  US President Trump’s apparent playing down of the pressure to strike a partial deal with China before the 2020 election weighed on stocks and lifted the so-called safe-haven currencies ahead of the weekend.  When everything was said and done, from the attack on Saudi Arabia to the money market squeeze in the US and the Fed’s rate cut, the dollar remained mostly within well-worn ranges.
The exceptions were idiosyncratic.  Growth concerns, both globally and domestically, saw the New Zealand dollar fall to new four-year lows ahead of the weekend.  The RBNZ meets next week, and the market has about six basis points of easing, or about a 25% chance of a cut.  The Australian dollar fell in four of last week’s five sessions and the day rose was by 1/100 of a penny, according to Bloomberg.  Sterling had threatened to break high in the second half of the week, but Ireland’s Deputy Prime Minister helped put Juncker’s seeming optimism in context.  UK Prime Minister Johnson reportedly acknowledged that the EU is unlikely to agree entirely with his proposal at the critical summit in the middle of next month.  These developments pushed sterling a cent off the highest level since July (~$1.2580).
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Russia energy minister Novak: Russia sticking to OPEC+ deal in full

  
Analysis, Crude

Crude oil is trading up $0.50 on the day

  • Russia is committed to OPEC+ deal in full
  • Talked to Saudi Arabia energy minister by phone on Wednesday
  • The situation has stabilized following the tax and Saudi Arabia
  • Saudi Arabia is not cutting its oil exports
  • No decision to change global oil deal targets
The price of crude oil is trading up about $0.50 at $58.61 currently. The high price today reached $59.54. There was some buying on the back of news that Saudi Arabia purchased oil from Iraq to fulfill contract obligations.  That gave traders some concern that production will indeed move back to normal by the end of September.  The low today reached $58.08.
Crude oil is trading up $0.50 on the day_
Technically the price remains above its 100 day moving average at $57.12. It’s 200 day moving averages at $56.33. Staying above those levels would keep the buyers more in control.
The spike high price on Monday, stalled ahead of the May high price at $63.81. The high price reached $63.33.

Saudi Arabia has already brought 40% of production back on line and rest could be back by month-end

  
Analysis, Crude
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Report from Energy Intelligence

oil 3 day chart
This is less-bullish for oil:
“Industry sources told Energy Intelligence that 40% of the lost production had already been restored by Monday, while one source said national oil company Saudi Aramco expects most of the rest — more than 3 million b/d — to be brought back on line by the end of September.”
More:
“Industry sources said that by Monday a combined 2.3 million b/d of oil production had been brought back on line — 2 million b/d at Abqaiq and 300,000 b/d at Khurais.Industry sources said Aramco would seek to keep up oil deliveries to its customers by drawing down oil it holds in storage, while also offering crude grade swaps and maximizing output from its offshore fields.”
WTI is up $7.70 to $62.56 — about 80-cents from the highs. Read the full report here.

Russia’s Novak: There is enough stockpiles to cover shortfall from Saudi Arabia

  
Analysis, Crude

Comments by Russian energy minister, Alexander Novak

Oil
  • We are in contact with Saudi Arabia
  • Need to see what happens there before taking any decision on Russian production
  • No immediate need to convene extraordinary OPEC+ meeting
Russia is continuing to play down the impact of the attacks on Saudi oil facilities over the weekend and to some extent, they’re not wrong.
The Saudis definitely have the stockpile to offset the loss of production in the near-term but the question now will be how soon can they get these facilities back online?
It’s more of a question of infrastructure in that regard but there’s no doubting that heightened geopolitical tensions in the Middle East will keep oil prices underpinned as well.
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