August 16, 2019 /08:29PM / By Tom Kool of Oilprice.com /
Header Image Credit: Oilprice.com
Oil prices rebounded on
Friday morning on the back of some positive U.S. crude data, but the rebound
doesn’t look likely to last as the world economy struggles
Friday, August 16th, 2019
Oil rebounded in early
trading on Friday after data showed that retail sales in the U.S. remain
strong, but fears of a global slowdown have not been fully allayed. “The
rebound has a corrective look about it on thin volumes, rather than a beachhead
for an impending rebound,” Jeffrey Halley, senior market analyst at OANDA,
told Reuters. “Overall, U.S. data continues to be a bright spot in a dark economic
recession fears. The inverted yield curve spread concerns
about a looming economic recession. Crude oil was not spared the global selloff
this week. Data from China and Germany this week raised more red flags. The one
bright spot has been U.S. consumer spending, which picked up in July.
Trade is slowing. WTO said that trade volumes could contract in the third quarter.
to end methane limits. The Trump administration is hoping
to end regulation on methane emissions, something that the industry has said that it
does not want. The proposal would prevent the federal government from
regulating methane from oil wells and infrastructure.
Hamm wants shale output cuts. Continental Resources (NYSE: CLR) CEO
Harold Hamm said that both OPEC+ and U.S. shale should cut production in order
to balance the market. U.S. shale producers “need to row our own boat,”
he said this week at an industry conference. “We need to make sure we
don’t oversupply the market.”
and gas bankruptcies on the rise. Through August, the
number of bankruptciesin the U.S. oil and gas industry this year has nearly reached the 2018
total. The total volume of debt affected so far ($20 billion) has surpassed
last year’s figure ($17 billion), according to Haynes & Boone.
Dakota oil production hits record. Oil output in North Dakota rose to 1.42 mb/d in June, a new record
and Trump battle on oil prices. A Reuters analysis posits that Saudi Arabia and Donald Trump tend to both
jawbone the oil market when prices get too far away from their preferred range.
Just as soon as Brent neared $60 per barrel recently, rumors surfaced that
Saudi Arabia was considering deeper action to rescue prices. The rumor alone
sent oil prices up. But in the past few years, whenever Brent rises into the
$70s, Trump has lambasted OPEC, demanding lower prices. The result is Brent
trapped between $60 and $75.
Arabia ramps up oil exports to China. Saudi oil exports to
China have doubled over the past year as U.S. sanctions curtail Iranian
receives first shipment to Corpus Christi. NuStar Energy (NYSE: NS)received its first shipment of Permian oil for its Corpus Christi export
terminal. “We continue to believe that the biggest impact from the growth in
the Permian Basin on the horizon is the growth in Gulf Coast crude exports,”
NuStar CEO Brad Barron said in a statement.
prices hit 5-year low. Ethanol futures prices for
September delivery fell to $1.27 per gallon, a five-year low. The U.S. EPA
issued a series of waivers a week ago to 31 oil refineries, causing havoc in
the market for ethanol and blending credits. “The Trump administration has
totally annihilated the margins for ethanol producers,” Charlie Sernatinger,
head of global grains futures with ED&F Man Capital Markets, said,
according to the Wall Street Journal.
shifts to euros. Rosneft asked buyers of a naptha cargo
to use euros, the first time it has done so, according to Reuters.
Permian pipelines start up. EPIC Midstream Holdings Inc.
began shipping crude on Thursday on its 400,000-bpd pipeline from the Permian
to the Gulf Coast, helping to push up Midland crude prices, according to Reuters. A second pipeline, the Cactus II pipeline from Plains All
American (NYSE: PAA), also began operations this week. That
line has a capacity of 670,000 bpd. Midland crude trades at a slight premium to
WTI, after suffering steep discounts last year because of a lack of
among world’s fastest growing gas producers. Russia’s
Gazprom, PetroChina and Pittsburgh-based EQT (NYSE: EQT) are ranked as the world’s fastest growing natural gas companies over the last
five years, according to Rystad Energy. However, EQT has announced an abrupt
slowdown in its expansion plans as its finances have proved to be
produces first oil at North Sea project. Equinor
(NYSE: EQNR) said it started up production at its Mariner heavy oil field in the
UK’s North Sea.
leases LNG-fueled tanker. ExxonMobil (NYSE: XOM) signed a two-year agreement to use Singapore’s first LNG-fueled bunker
tanker. Meanwhile, shipowners are increasing removing tankers from operation in
order to install scrubbers ahead of the 2020 IMO regulations.
1. Average Prices
of PMS, AGO, HHK and Cooking Gas – July 2019
2. Oil Soars As The
U.S. Delays Trade War Tariffs
Price Risk Has Shifted To The Downside
Markets On Edge Despite Price Bounce – OIR 090819
5. OPEC Production
Slumps To 5-Year Low
6. Oil Struggles As
Markets Rocked By Trade War – OIR 060819
7. 5.61bn Litres of
PMS Imported into Nigeria in Q2 2019 - NBS
8. Sahara Group
Lauds Investment Opportunities in Angola’s Downstream Sector
9. Oil Prices
Rebound After A Difficult Day - OIR 020819
10. Oil Markets On
Edge Ahead Of Big Week - OIR 300719
11. Oil Markets
Struggle For Direction- OIR 260719
12. Oil Markets
Ignore The Tanker War- OIR 230719
13. Oil Capped By
Shaky Demand Outlook - OIR 190719
14. Oil Falls Back
As Iran Risk Factor Fades - OIR 160719