Oil Slumps Below $50 After Goldman Shrugs At Venezuela Sanctions Impact

Tyler Durden's picture

As US equity markets push higher this morning, because that's what they do, WTI Crude prices are sliding back below $50 as Goldman poured cold water on the idea that sanctions of Venezuela will impact prices.

Goldman says U.S. oil sanctions on Venezuela would have little impact on prices.

  • A U.S. ban on Venezuelan exports, or imports, would lead to reshuffling of oil trade flows with likely limited impact on prices
  • Should ban on U.S. crude imports from Venezuela be implemented, South American country would see further declines in oil revenues by $1.5/bbl given higher freight costs to India and China
  • Assuming both import, export bans are implemented and Venezuela further discounts its crude by $1/bbl to incentivize substitution, Brent would need to fall below $34/bbl to make Venezuela’s highest cost blended heavy oil production uneconomical

And traders seem to be listening.

Of course, stocks don't care...

Furthermore, Bloomberg's tanker tracking shows rising exports in Libya and Iran, while Venezuelan shipments decline.

We wil se what tonight's API print says about the 'rebalancing'.

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LawsofPhysics's picture

Talking about the price of anything in the absence of price discovery is a fool's errand. The price will be whatever the owners of The Fed want it to be, period.

spastic_colon's picture

what did I tell you yesterday about the "magic" equity markets after yesterdays "ugly" close...............goldman eT. Al. are only players in price suppression they and others will not let commodity price inflation happen.

 

https://youtu.be/KNE2Oqut238

 

Ink Pusher's picture

The real price of oil should be between $32-$35 /Bbl. Today. 

Any spec. above that line is absolute manipulated gross fantasy.

Between the repeating fake drawdowns and overt daily bullshit pricing manipulation

none of the standard pricing formulas are to be considered accurate or trustworthy.

Oil markets are now more heavily manipulated than Gold.

Fucking Goldman is ignoring Venezuela and the Russ0-Chin0 vultures are 

simply waiting in the wings to swoop in and cut a backdoor deal

while Uncle Sam is busy playing hard to get.

 

dark pools of soros's picture

So is Libya just an automated oil field these days? no humans left there?

JPMorgan's picture

The oil market is a bit of non-story really, they pulled the plug in mid 2014.

And that's where it's been ever since.

 

ThisIsMadness's picture

Is this why gas prices were up $.20 per gallon in my neighborhood? 

JPMorgan's picture

Yup pump prices are not far off the same level as when oil prices were over $100 a barrel in this area.

And that's because it's one big consumer con game.

Low prices... just not for you.

mily's picture

That was yesterday. Maybe somone already knows API build is going to be reported tonight