Weak Global Economic Growth Linked To Oil Price Collapse

We begin with a quick look at some of the critical figures and data in the energy markets this week before looking at some of the key market movers and providing the latest analysis of the top news events taking place in the global energy complex over the past few days (Click to enlarge) (Click…

Only Recession Can Prevent An Oil Price Spike

The biggest result from the collapse in oil prices could be a future price spike. Oil prices at $30 per barrel have put most producers under water. That has led to austere budgets and severe cuts to spending. Wood Mackenzie recently estimated that $380 billion in major oil projects have been delayed or cancelled since….

Rumors of OPEC-Russia Coordination Send Oil Prices Surging

Oil prices surged by midday on Wednesday on comments from Russian officials hinting at possible coordination with OPEC on production cuts in an effort to arrest the decline in prices. The day didn’t start off on such a positive note. The EIA reported a massive increase in oil storage levels – a jump of 8.4…

Weak Economy Could Stifle Oil Price Rally

As I have explained previously, the main drivers for a sustained oil price recovery – if we shove aside all the media noise and fundamentals – will be Fed policy changes and or OPEC production cuts. It appears that both are about to happen. First, quasi-recessionary statistics are becoming louder and louder and are now…

Fundamentals For Oil Still Bearish, But Sentiment Is Shifting

Oil speculators spent the latter half of 2015 with an incredibly pessimistic view of the trajectory for oil prices. Speculators piled into short positions, pushing net-shorts to multiyear highs. But speculators are at a bit of a crossroads at this point. With oil down to $30 and below, a growing number of hedge funds and…

Despite Huge Losses Oil Companies Reluctant To Shut In Production

As energy investors look for reasons to be optimistic, many are keeping close tabs on supply figures. There are some signs that supply is taking a hit from disparate parts of the globe. According to Bloomberg, China might see its output dip by 3 to 5 percent in 2016, down from a record high of…

No Agreement on OPEC Meeting After Venezuela Meets With Saudi Arabia

The prospects for an emergency OPEC meeting to initiate coordinated production cuts took a hit this weekend. Venezuela’s oil minister Eulogio del Pino flew to Riyadh to meet with Saudi officials, which followed a recent trip to Moscow to gin up support from Russia for their cooperation. Venezuela has sent a formal request to OPEC…

Computerized Trading Creating Oil Price Volatility

Recently, I dedicated some time studying in much further depth the explosion in volatility in the broader market as well as in underlying stocks. We have witnessed unprecedented volatility in E&P stocks in recent months. But the commodity crash is spreading to Biotechs and even the broader technology sector with the implosion of Linkedin stock…

IEA: No Oil Price Rally In The Short Term

“It is very hard to see how oil prices can rise significantly in the short term.” For oil prices, the “short term risk to the downside has increased.” Those were the conclusions from the IEA’s February Oil Market Report. On the heels of the plunge in oil prices to $26 per barrel, the IEA sounded…

Could Gasoline Drop Below $1 Per Gallon?

Retail gasoline prices have dipped below $2 per gallon across the United States. But gas might drop below $1 per gallon soon in some places of the country. Aside from the financial crisis, when gasoline prices dropped below $2 per gallon for just a few months, retail gasoline prices have not been below $2 since…

Oil Glut Compounded By Cracks In Global Economy

Will oil go below $20? Jeffrey Currie, the head of commodities research at Goldman Sachs,said on Bloomberg TV on Tuesday that he wouldn’t be surprised if oil dipped “into the teens.” That would upend the financial prospects for a lot of oil and gas companies. In January, Moody’s Investors Service put 120 oil and gas…

OPEC-Russia Rumors Persist After Comments From Rosneft Chief

The rumors over a coordinated production cut between OPEC and Russia continue. On Wednesday, the head of Russia’s state-owned oil company Rosneft floated the idea of participating in a production cut. Or did he? Rosneft’s chief Igor Sechin, arguably the most important voice from Russia’s energy sector, said major oil producers should cooperate to remove…