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Oil Slumps to Five-Year Low as OPEC Decision Spurs Forecast Cuts – Bloomberg
Oil Slumps to Five-Year Low as OPEC Decision Spurs Forecast Cuts – Bloomberg.
Brent crude slumped to a new five-year low as OPEC’s decision last month to maintain output at a time of oversupply prompted a growing number of banks to cut price forecasts. West Texas Intermediate also slumped.
Futures dropped as much as 2.5 percent in London and 1.9 percent in New York. Morgan Stanley lowered its 2015 estimate by 29 percent in a report on Dec. 5, citing a decision by the Organization of Petroleum Exporting Countries not to lower a 30 million-barrel-a-day output target. Banks including BNP Paribas SA, Credit Suisse Group AG, UBS Group AG and Barclays Plc have also cut since the 12-nation group’s Nov. 27 meeting.
“The major forecasters continue to cut price expectations, especially for the first two quarters of 2015,” Ole Hansen, head of commodity strategy at Saxo Bank A/S, said by e-mail. He forecasts Brent may drop as low as $60 a barrel within the next several months, a slump of about 12 percent from current prices.
Oil is trading in a bear market amid signs that U.S. output is expanding even after the decision by OPEC, which is responsible for about 40 percent of global supplies. Explorers in the U.S. increased the number of operating rigs last week, defying predictions of a drilling slowdown, according to data from Baker Hughes Inc.
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Brent Rebounds From $70 as Oil Rout Stutters After OPEC Inaction – Bloomberg
Brent Rebounds From $70 as Oil Rout Stutters After OPEC Inaction – Bloomberg.
Brent crude rebounded from near $70 a barrel as the market rout prompted by OPEC’s failure to curb production falters. West Texas Intermediate rose for the second day in three.
Futures advanced as much as 1.3 percent in London and 1.6 percent in New York. The global benchmarks fell 18 percent last month after the Organization of Petroleum Exporting Countries maintained its output target at 30 million barrels a day, opting to let low oil prices force U.S. shale producers to cut supply. Saudi Arabia won’t give up market share “at this time for anybody,” said Prince Turki Al-Faisal, the kingdom’s former intelligence chief.
Crude is in a bear market as the U.S. pumps the most oil in more than three decades while global demand slows. OPEC, responsible for about 40 percent of the world’s supply, resisted calls from members including Venezuela to reduce its quota at the Nov. 27 meeting in Vienna.
“The market is still trying to find its feet following the OPEC meeting last week,” Jens Naervig Pedersen, a commodities analyst at Danske Bank A/S, said by e-mail from Copenhagen today. “There seems to be some short-term support around the $70 to $72-a-barrel mark for Brent. But overall the market is still plagued by uncertainty.”
Brent for January settlement gained as much as 92 cents to $71.46 a barrel on the London-based ICE Futures Europe exchange and was at $70.81 at 10:41 a.m. London time. It dropped $2 yesterday to $70.54. The European benchmark crude traded at a premium of $3.46 to WTI. Prices are down 36 percent this year.
Oil Prices Collapse After OPEC Keeps Oil Production Unchanged – Live Conference Feed | Zero Hedge
Oil Prices Collapse After OPEC Keeps Oil Production Unchanged – Live Conference Feed | Zero Hedge.
But, but, but… all the clever talking heads said they wil have to cut…
- *OPEC KEEPS OIL PRODUCTION TARGET UNCHANGED AT 30M B/D: DELEGATE
WTI ($70 handle) and Brent Crude (under $75 for first time sicne Sept 2010) are collapsing… as will US Shale oil company stocks and bonds (and thus all of high yield credit) tomorrow. The Saudis are “very happy” with the decision, Venzuela ‘stormed out, red faced, furious.’ Commentary from various OPEC members appears focused on the need for non-OPEC (cough US Shale cough) nations to “share the burden”and cut production (just as the Saudis warned yesterday).
It appears OPEC members have varying opinions…
- *KUWAIT’S OIL MINISTER SAYS HAPPY WITH OPEC OUTPUT DECISION
- *OPEC DECISION IS `VERY HAPPY’ ONE: [SAUDI ARABIA] NAIMI
- *IRANIAN OIL MINISTER SAYS HE’S `NOT ANGRY’ WITH OPEC DECISION
- #OPEC Venezuela Ramirez storms out red faced. Looked furious.
- *OPEC, NON-OPEC MUST SHARE OIL MKT BURDEN: NIGERIA MINISTER
- *OPEC `NOT PLAYING HARDBALL’ IN OIL MARKET: NIGERIA MINISTER
- *OPEC DECISION WAS BEST THING TO DO AT THIS TIME: NIGERIA
- *OPEC MADE A GOOD DECISION: ECUADOR OIL MINISTER
- *WE ARE MAINTAINING OPEC UNITY: ECUADOR MINISTER
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Oil Tumbles to 4-Year Low Before OPEC, Pulling Down Krone – Bloomberg
Oil Tumbles to 4-Year Low Before OPEC, Pulling Down Krone – Bloomberg.
Oil slid to a four-year low amid speculation OPEC will refrain from cutting output at today’s meeting, dragging down shares of energy companies, Gulf-region stocks, and the Norwegian krone. Government bonds rose, with yields in Europe falling to record lows.
West Texas Intermediate crude tumbled 2.1 percent to $72.15 a barrel at 11:07 a.m. London time, a fourth-straight decline. While the Stoxx Europe 600 Index gained 0.2 percent after data showed record-low German unemployment, a gauge of energy producers slid 1.3 percent. Qatar and Oman led stocks lower in the Gulf region, and Norway’s krone weakened against all its 16 major counterparts. France’s 10-year yield fell to an all-time low of 1.006 percent.
Representatives from the 12-member Organization of Petroleum Exporting Countries are meeting in Vienna, with oil prices mired in abear market. The 27 percent drop this year has pulled the Stoxx 600 Oil & Gas Index down 6.5 percent, weakened currencies of commodity-producing nations and damped inflation, helping fuel a rally in fixed-income assets. Germany will release consumer-price data today as investors weigh whether the European Central Bank will step up stimulus. Most U.S. markets are closed for Thanksgiving.
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