Crude

Analysts Respond To Doha Meeting Failure: "Blow To Sentiment"

Failure to proceed with crude output freeze plan seen as a "serious blow" to oil-market sentiment by Energy Aspects; Barclays expects mounting tensions between Saudi Arabia and Iran to boost volatility. Separately, Kuwait oil workers strike viewed as price-supportive.  Here, courtesy of Bloomberg, is a summary of what analysts have said so far on meeting’s outcome as well as comments on Kuwait:

 

Futures Wipe Out Most Overnight Losses Following Dramatic Rebound In Crude

Following yesterday's OPEC "production freeze" meeting in Doha which ended in total failure, where in a seemingly last minute change of heart Saudi Arabia and specifically its deputy crown prince bin Salman revised the terms of the agreement demanding Iran participate in the freeze after all knowing well it won't, oil crashed and with it so did the strategy of jawboning for the past 2 months had been exposed for what it was: a desperate attempt to keep oil prices stable and "crush shorts" while global demand slowly picked up.  And whether it is central banks, or chronic BTFDers, just 12 hours after oil opened for trading with a loud crash, the commodity has nearly wiped out all losses, and both brent and WTI were down barely 2%, leading to both European stocks and US equity futures virtually unchanged on the session. 

Goldman On Doha: "Bearish For Prices ", Expect "High Price Volatility"; Saudi Oil Production May Jump

"we view this outcome as bearish for oil prices given consensus expectations for a “soft guidance” freeze at January production levels"... "We therefore view risks to our Saudi forecast as skewed to the upside: it is at the guidance provided by the deputy crown prince in his latest interview with Bloomberg this week, with such volumes presented as contingent on a deal to freeze production being reached."

Oil Futures Crash Most In 7 Months, Stocks Tumble

With commodity currencies (AUD and CAD) dumping, Yen strength (risk-on carry unwinds en masse), Saudi stocks tumbling, and hedge fund spec crude longs near record highs, it is no surprise that the opening prints in WTI Crude are ugly after Doha's disappointing climax. Erasing all of last week's hype hope, WTI printed with a $38 handle (June), $37 Handle (May) and is unable to bounce for now. Dow futures -100.

Loonie Plunges Most In A Month Ahead Of Crude Open

As markets flutter to life following the Doha disappointment, it is clear some turmoiling is to come. Canadian Dollar is down over 1% against the US Dollar - the biggest drop in 4 weeks - erasing all of last week's gains. Ahead of this evening's crude futures open, CAD implies a sub-$39 open for WTI...

"I Am Not Sure You Can Call It A Freeze" - OPEC Deal In Jeopardy As Saudi-Iran Tensions Spike: All The Latest

A spike in tensions between arch-rivals Saudi Arabia and Iran appeared on Sunday to ruin prospects of the first binding oil output deal in 15 years between OPEC and non-OPEC nations, and looked set to prompt another fall in the price of crude.  "I am not sure you can call it a freeze," one OPEC source said. A senior oil industry source said: "The problem now is to come up with something that excludes Iran, makes the Saudis happy and doesn't upset Russia."

And Scene: In Last Minute Iran Pulls Out Of Doha Meeting

The "OPEC production freeze" farce was fully exposed this morning when after pretending whether or not to participate in the Qatar meeting, Iran finally decided it will not attend the Doha meeting, two sources familiar with the situation told Reuters. Iran's oil minister had not been scheduled to attend, but Tehran was due to send Iran OPEC Governor Hossein ‎Kazempour Ardebilli, oil ministry news agency Shana reported on Friday. Iran had been informed that only those countries willing to agree to freeze their output level should attend.

Doha Is Done: Saudi Prince Drops Bomb - "No Deal Without Iran...We Are Selling At Every Opportunity"

In what appears to be a Doha party-pooping statement, Saudi deputy crown prince Mohammed bin Salman stated unequivocally that The Kingdom won’t restrain its oil production unless other producers, including Iran, agree to freeze output at a meeting this weekend in Doha. This a major problem because - if you remember - this week's melt-up in oil (and thus stocks) was predicated on an anonymous diplomat cited by Interfax saying a deal will get done without Iran (which the Russians refused to confirm). All that hope crushed by a reality that has been painfully obvious that no side will be given in the Iran-Saudi tete-a-tete... and now, as Citi warned "expect a sharp sell-off."

Crude Oil Prices Rise On New Record Low US Rig Count

With all eyes on Doha this weekend, today's rig count data may have even less signaling power than normal. The US oil rig count has risen for only one week this entire year and continues to track lagged crude prices lower, dropping 3 to 351 (lowest since Oct 09). With gas rigs unchanged, the total rig count dropped once again to a new fresh record low at 440. The reaction in crude oil prices was a small bounce.

"If No Agreement, Expect A Sharp Selloff" - All You Need To Know About Doha

Sunday’s producer meeting is all about nothing no matter what agreement might be forged. At best, the agreement will be, as Russia’s energy minister has stated, a gentlemen’s affair, with no binding commitments, no concrete next steps beyond having a review meeting, and no procedure for moving to production cuts.

The Bank Of Japan Already Owns Over Half Of All ETFs; It Wants To Own More

Less than six months after we pointed out that the BoJ owns 52% of the entire Japanese ETF market, Reuters reports that the Kuroda's Peter Pan fairy tale, aka the Bank of Japan, is thinking about buying even more. The BoJ is said to be currently buying $30 billion of ETF's a year under its current policy, however since the Nikkei is down over 10% this year, that figure is apparently not enough to keep the market propped up.