Crude

What Oil Production Freeze: Russia Just Revealed The Laughable Loophole In The OPEC "Agreement"

Russia will export more oil to Europe in April than it has in any month since 2013 - despite Moscow's plan to sign a global agreement on freezing production in a bid to lift the price of crude. Asked what would be covered by the agreement, Russian Energy Minister Alexander Novak told reporters: "The discussion is only about freezing production. And not exports." In other words, the global supply glut is about to get even worse thanks to the likes of Russia, which is about to unleash an additional 2.4 million tonnes of ooil exports onto a world which is already drowning in excess oil.

U.S. Futures Slide, Crude Under $39 As Dollar Rallies For Fifth Day

Following yesterday's dollar spike which, which topped the longest rally in the greenback in one month, the prevailing trade overnight has been more of the same, and in the last session of this holiday shortened week we have seen the USD rise for the fifth consecutive day on concerns the suddenly hawkish Fed (at least as long as the S&P is above 2000) may hike sooner than expected, which in turn has pressured WTI below $39 earlier in the session, and leading to weakness across virtually all global risk assets.

Why Oil Prices Are About To Plunge Again: 31 Million Barrels In Floating Storage Are Coming On Shore

Based on the all-in cost of operating tanker storage (dirty VLCC tanker day rates, financing, transit and transfer loss, insurance and bunkers, Figure 5), the current storage cost is too high relative to the steepness of the Brent forward curve. This means that prices do not justify inventory build, but rather gradual inventory drawdown as existing storage trades are unwound.  Comparing the current level of floating storage (157.3 million barrels) versus that in early February (126.6 million barrels), there may be an additional 31 million barrels of inventory to be drawn down between now and the next inventory trough over the next several months.

Oil Hits Critical Choke Point: Why "The Market Faces A Round Of Rapid Stockbuilds"

Ian Taylor, CEO of oil trader Vitol said on Tuesday that "stocks of crude and products continue to build and these will weigh upon the market". Global distillate stocks in the developed world are close to a record high, in the thick of refinery maintenance season, and in the run-up to the time when gasoline use hits its summer high point, but interest in diesel typically fades. "Absent run cuts, the market faces another round of rapid stockbuilds once refineries return from maintenance>"

Oil Pumps'n'Dumps As DOE Reports 2nd Biggest Inventory Build In A Year, Production Drops

Following last night's API-reported yuuge build in crude of 8.8mm barrels (and draw in gasoline and Cushing - confirming Genscape's earlier report), DOE reports today an even bigger 9.36m barrel build - the 2nd biggest build in a year. Crude prices were confused as this massive build was offset by a drop in crude prioduction to Nov 2014 lows and a big draw at Cushing... but for now Oil is extending losses.

Dollar Winning Streak Continues For Fourth Day Pushing Oil Lower; Futures Flat

Following two days of rangebound moves, where Monday's modest market rebound was undone by the Tuesday just as modest decline (despite the early surge higher on the latest "bullish for stocks" European terrorism), overnight equity action continued to be more of the same, and as of this moment S&P 500 futures were unchanged, while European stocks were modestly higher. But while equities remain surprisingly uneventful despite loud warnings by both JPM and Goldman now that another bout of volatility and equity downside is coming, in FX there has been a substantial change, one which has seen the US dollar rise for a fourth day, the longest winning streak in a month, driven by the latest round of hawkish Fed jawboning courtesy of the Chicago Fed's Charlie Evens yesterday, which in turn has pushed down prices of oil, gold and copper.

Crude Drops On Yuuge Inventory Build

Overall crude inventories rose for the 6th week in a row according to API. Despite draws in Gasoline, Distillates, and Cushing; Crude inventories surged 8.8mm barrels - the 2nd biggest weekly build in a year. Crude prices are giving back the terrorism bounce gains (testing to a $40 handle in after-hours).

The Current Oil Price Rally Is Reaching Its Limits

Oil prices have climbed by about 50 percent from their February lows, topping $40 per barrel. But the rally could be reaching its limits, at least temporarily, as persistent oversupply and the prospect of new shale production caps any potential price increase.

The High Yield Bond 'Emperor' Has No Clothes, BofA Warns 1 In 3 Firms Face Default Threat

The market reaction from last week’s dovish FOMC statement took many by surprise, including BofAML's HY Strategy team, but as they say the High-Yield Emperor has no clothes, warning that the underlying commentary provided by Chair Yellen shows the vulnerability for high yield issuers to longer-term growth trends. Couple the deteriorating fundamentals for HY issuers with downgrades outpacing upgrades by a ratio of 3.5:1 and a worsening of global growth potential, and they believe the recent rally, though boosted by strong inflows and cash generation, will ultimately fade.

Oil Rips On Yet Another Doha "Freeze" Meeting Headline (As Predicted)

Around 915ET we tweeted the need for an OPEC meeting headline as oil prices started to accelerate losses. 70 minutes later, the market's "wish" was granted when Algeria (yes, seriously) announced they will attend, Nigeria is hopeful, and Libya said it would not attend... of course any headline is a buying opportunity and the algos went wild...

Janet Yellen: Monetary Arsonist - Armed, Dangerous And Lost

Simple Janet should have the decency to resign. The Fed’s craven decision last week to punt on interest rate normalization is not merely a reminder that she is clueless and gutless; we already knew that much. Given the overwhelming facts on the ground - 4.9% unemployment, 2.3% core CPI and a 23.7X PE multiple on the S&P 500 - her decision to “pause” after 87 months of ZIRP actually proves she is a blindfolded monetary arsonist - armed, dangerous and lost.