Fed Officials Do Not Expect Quick Rebound in Economy
May 8th, 2020
Crude prices were higher in early trading yesterday as news of Saudi Arabia raising their selling price for oil and an increase in Chinese export for April were supportive news. Price did ease off the highs as the market got to the end of the days as more global demand impact from the coronavirus continues to be a factor.
Saudi Arabia increased its official selling prices for oil in June after cutting May exports to almost the lowest in a decade following the OPEC+ cut dealing starting May 1. This action is viewed by experts as a strong indication that Saudi Arabia will follow thought on its pledged oil supply cuts agreed upon. OPEC+ has pledged cutting 9.7 million bpd in oil output for May and June.
Adding to some of the bearishness for the market 3 federal reserve presidents said they do not expect a quick rebound in the US economy. On that note the jobs number, out this morning showed the worst number in history with 20.5 million job losses in April and unemployment rising to 14.7%. A study from the Society of Human Resources Management showed that fifty-two percent of small businesses in America expect to shut down within six months. The group’s leader Johnny Taylor said, “We’re talking about roughly 14 million businesses.”
Pioneer Natural Resources expect oil prices to recover to at least $45 per barrel this year. Pioneer’s CEO, Scott Sheffield, said that even when US benchmark prices return to that level, few shale producers will be able to increase production because their high debt levels.
Hess CEO, John Hess, said the company came into 2020 with about 80% oil production hedge. It came into 2020 with put options for 130,000 bpd of WTI at $55 per barrels and 20,000 bpd of Brent at $50 per barrel.
According to a Reuters analysis of US state and company data, North America oil companies have cut production faster than OPEC officials and industry analysts expected, on course to cut about 1.7 million bpd by the end of June. The largest cuts are coming from Texas, with output cuts of about 20% of its capacity or 1 million bpd by the end of May.
Report that the US and China had phone call with respect to the Phase 1 trade deal and it was a very positive is offering support to the markets.
Fed Officials Do Not Expect Quick Rebound in Economy
May 8th, 2020
Crude prices were higher in early trading yesterday as news of Saudi Arabia raising their selling price for oil and an increase in Chinese export for April were supportive news. Price did ease off the highs as the market got to the end of the days as more global demand impact from the coronavirus continues to be a factor.
Saudi Arabia increased its official selling prices for oil in June after cutting May exports to almost the lowest in a decade following the OPEC+ cut dealing starting May 1. This action is viewed by experts as a strong indication that Saudi Arabia will follow thought on its pledged oil supply cuts agreed upon. OPEC+ has pledged cutting 9.7 million bpd in oil output for May and June.
Adding to some of the bearishness for the market 3 federal reserve presidents said they do not expect a quick rebound in the US economy. On that note the jobs number, out this morning showed the worst number in history with 20.5 million job losses in April and unemployment rising to 14.7%. A study from the Society of Human Resources Management showed that fifty-two percent of small businesses in America expect to shut down within six months. The group’s leader Johnny Taylor said, “We’re talking about roughly 14 million businesses.”
Pioneer Natural Resources expect oil prices to recover to at least $45 per barrel this year. Pioneer’s CEO, Scott Sheffield, said that even when US benchmark prices return to that level, few shale producers will be able to increase production because their high debt levels.
Hess CEO, John Hess, said the company came into 2020 with about 80% oil production hedge. It came into 2020 with put options for 130,000 bpd of WTI at $55 per barrels and 20,000 bpd of Brent at $50 per barrel.
According to a Reuters analysis of US state and company data, North America oil companies have cut production faster than OPEC officials and industry analysts expected, on course to cut about 1.7 million bpd by the end of June. The largest cuts are coming from Texas, with output cuts of about 20% of its capacity or 1 million bpd by the end of May.
Report that the US and China had phone call with respect to the Phase 1 trade deal and it was a very positive is offering support to the markets.