Oil drops most since 1982

[Pitcher]

Oil at 11.24. Ouch

[mr.unlikely]

Wow! Pitcher, whats the play?

[King Bean]

Wow. I remember the oil embargo and lines of cars, some stations

only allowing 10-gal per customer. But with prices crashing down,

I will be lining up to fill everything. Including the kids pedal racer. LOL. 

 

                          Thanks for the update Pitcher.

 

      

 

[southbeach]

bump

[fancy]

47 minutes ago, southbeach said:

bump

 

[MyLadiesDaddy]

1 hour ago, mr.unlikely said:

Wow! Pitcher, whats the play?

OIL (WTI) Commodity

10.96

 

-7.16

 

(-39.51%)

 

I think the play is, revalue your dam currency or we'll destroy the entire middle east 

[Pitcher]

1 hour ago, mr.unlikely said:

Wow! Pitcher, whats the play?

 

The play is to watch, wait, and pick out 1-2 stocks to follow. This oil deal will get resolved and the big boys will survive. CVX is my play when the time is right.  I thought we might go to the mid teens but this is down right scary for our oil companies.  

 

I know now a lot of people hate oil companies but if they get run out of business you will hate buying oil from the ME and Russia at 100-200 a barrel a lot more.  This is a grab for market share and control by SA and Russia.  They are deliberately trying to crush the Texas shale oil companies.  

 

SA, Iran, Iraq, had better knock it off or we will take them over and rename the region Texaco.  Do not doubt me on this.  We will never be held up by the ME or Russia when it comes to oil.  The oil blackmail business is over!!!!!

[ChuckFinley]

Thanks Pitcher, always like reading your stuff.  😎

[DoD]

It sure would suck if your country was like 95-98 percent dependent on the oil market...WHOOPS I know a couple of them right off....

[boosterbglee]

Oil......$4.81🙀

[stanleypower]

$2.63........ WTF!!!

[King Bean]

Noon MST. Under $2.00. Crazy. I may have to put a storage tank in the back yard. 

[usndiver]

Oil Prices Crash as Storage Shortage Looms

139 Hussein Malla/AP Photo

John Carney

20 Apr 2020792

2:12

The joke among oil traders Monday morning is that gas stations will soon be paying customers to fill up their tanks as the search for storage options intensifies.

Oil prices plunged on Monday to multi-decade lows. The front-month May contract for West Texas Intermediate futures, which expires Tuesday, fell by more than 36 percent to $11.55 a barrel.

Soon to be expiring contracts are typically traded in lower volumes. Som\e traders may be selling the expiring May contract for fear that storing oil will become more expensive as high production numbers clash with low demand around the globe.

The June WTI contract for West Texas Intermediate futures, fell by more than 11.5 percent. Brent crude oil, considered the global benchmark, fell by around 6 percent.

Analysts are concerned that the capacity for storing oil may run out soon. The storage facility in Cushing, Oklahoma has become a particular focus. Connected by pipeline to Canada, West Texas, the Gulf Coast, and the American Midwest, Cushing is where the physical delivery of most WTI takes place. That end-stage of billions of dollars of daily trading, most of it purely financial and settled with contracts, is becoming more expensive as crude stockpiles have accumulated.

Efforts to curb production, such as a recent agreement between Russian and Saudi Arabia, appear to have fallen short.

When prices for futures contracts expiring further out are higher than contracts expiring sooner, traders describe the market as being in “contango.” The opposite, where near-term contracts are cheaper than long-term, is called “backwardation.” The current market, with a steep discount for oil available for near-term delivery, is known as “super-contang0.” The definitions of those terms may not matter to most consumers but they are fun to say.

“Uncontained contango,” is a new phrase being thrown around to describe super-contango driven by lack of storage capacity.

 

https://www.breitbart.com/economy/2020/04/20/oil-price-crash/

 

[The Englishman]

WTI.

Hit $0.00 per Barrel.

Moved to $0.01 pb but looks like trading id suspended.

[boosterbglee]

Interesting to see who blinks in this oil war !

 

-35.20

[Arceo]

7 minutes ago, boosterbglee said:

Interesting to see who blinks in this oil war !

 

-35.20

Can you break this down in a 5 bullet point summary of what’s happening? The idiot version. 

[Adam Montana]

[Rochester]

My guess is Trump will put tariffs on importing foreign oil....to keep American producers alive.....if I remember correct, he has mentioned that in the recent past. No need for oil war. That's actually what Iran wants, so they can turn their population against America...most younger Iranians are pro-American.

 

The US can have a "Made in USA" price on oil,  that will keep American producers alive, till this passes. America will be fine, the ME will be weakened by all this.  

 

Think about how this same principle works with medicine:

 

America really got screwed over, by sending all the American companies that made medicine, over to China, years ago. US companies got greedy, didn't put America first. They wanted to take advantage of cheaper foreign labor. Time for the "Dr. Phil Question" on that one: How's that workin' for you?

 

There''s an old English expression for this sort of thinking: Penny wise, pound foolish...which is something that appears cheaper at first, but really is much much more expensive in the long run. 

 

If America is foolish enough to become trapped once again, in dependency on ME oil, then in 5 or 10 years, when this screws America over royally, 💂‍♂️ I'll again ask the Dr. Phil Question, on that move. However I'm not worried. President Trump has good judgement. He'll never let America get trapped and dependent on foreign oil.....it's a vital necessity to the economy, just like Ventilators and Medical Supplies and Pharmaceuticals. 

 

This crash in oil prices, is revealing the weakness of the ME. They are mostly 1 product countries. All they got is bananas and the world is not in the mood for bananas. 

[Adam Montana]

Link: https://markets.businessinsider.com/commodities/news/us-crude-oil-wti-falls-to-21-year-low-1029106364 

Oil plunges 321% into negative territory for the first time ever as demand evaporates

 

Saloni Sardana

 Apr. 20, 2020, 05:39 AM

 

Reuters

 

• Oil prices plunged into negative territory to a record low on Monday as uncertainty mounted around storage of excess supply.
• WTI crude oil futures expiring in May plunged 321% to close at negative $40.32 a barrel, while Brent slid 9.5% to $25.41 at intrasession lows.
• The coronavirus pandemic has torpedoed demand for the commodity, with fuel use in cars and planes slumping.
• The commodity fallen over the past week even after OPEC and its allies agreed to a historic production cut intended to backstop prices.
• The WTI market has entered contango, meaning spot prices are now lower than prices for future delivery of crude oil, a highly unusual occurrence.
• Follow the price of oil live with Markets Insider.

---

Oil plunged into negative territory for the first time on record. The commodity's latest round of sharp selling comes as uncertainty mounts around storage for excess oil. Demand for crude has plummeted since the coronavirus outbreak has frozen activity worldwide.

The price of West Texas Intermediate crude oil futures expiring in May plunged 321% to negative $40.32 cents a barrel, the lowest level ever recorded. Brent crude losses were muted by comparison, with the commodity sliding 9.5% to $25.41 a barrel at intrasession lows.

The price of oil has continued to slide even after OPEC and its allies agreed to the biggest-ever production cut — one intended to backstop prices. Investors remain unconvinced the cuts can offset cratering demand for the commodity as the novel coronavirus keeps society from operating normally.

 

 

Read more: Why the price of oil is continuing to free-fall after a historic supply cut — and when experts think it may finally reach rock bottom

Concerns around storage come as WTI crude for May delivery trades at large discounts to longer-dated contracts. That dynamic is playing out amid worry that a key storage hub in Cushing, Oklahoma, is nearing capacity, according to Bloomberg.

"Basically, bears are out for blood," said Naeem Aslam, the chief market analyst at AvaTrade. "The steep fall in the price is because of the lack of sufficient demand and lack of storage place given the fact that the production cut has failed to address the supply glut."

He added: "The bottom line is that there is no doubt that oil prices are way oversold at the current level, but given the circumstances, it is likely that the price may continue to fall further because the rig count hasn't touched its bottom yet."

Read more: GOLDMAN SACHS: Buy these 21 stocks that are beating their peers by paying down debt amid an unprecedented plunge in cash spending

 

 

Oil prices and rig counts are strongly correlated. Higher oil prices make production more profitable, encouraging more producers to operate.

The closely watched Baker Hughes oil-rig report showed that as of Friday oil-rig counts in the US were 544, roughly 35% down from the same time in March.

Oil is now in contango

The movements prompted WTI oil prices to enter contango, meaning that oil contracts for future delivery are more expensive than spot prices.

"The contango on WTI from now spot to the June contract can be described as a mega-contango," Jeffrey Halley, a senior market analyst of Asia Pacific at Oanda, said. "As of Friday, spot was $18 a barrel with the June contracts around $25 a barrel."

"The extreme contango tells us nobody in America wants the oil in the short-term," Halley added. 

 

 

Monday's price action pushed the commodity further into contango.

"For an investor who holds a long term perspective, a time frame of 12 months to 24 months, the current plunge in oil price represents an opportunity," Aslam said.

[KristiD]

Okay......  I'm not saying this isn't really, really bad, because it really, really is.  But most of us here follow oil because of Iraq so I will point out that it's only WTI, West Texas Intermediate, oil that's crashed.  I believe Iraq sells at the Brent price which is hovering around $25-26, still down from the low $30's of the last few days, but not crashed to zero.  I notice there's also an OPEC basket price, though - and maybe someone in the know here will tell us if that's the price Iraq sells its oil at or if it's at the Brent price.  The OPEC basket price is around $17-18, but I see on oilprice.com that there is a 4 day delay in updating that so we won't know what happened with it today for another 4 days.  For the record, WTI and Brent update every 26 and 10 minutes respectively.   

• All Prices
• OPEC Blends
• Canadian Blends
• U.S. Blends

WTI CRUDE •	-18.200	-36.470	-199.62%
BRENT CRUDE •	25.88	-2.20	-7.83%
MARS US •	19.67	-1.10	-5.30%
OPEC BASKET •	17.73	+0.22	+1.26%
URALS •	23.05	-0.25	-1.07

 

[DinarThug]

11 minutes ago, Adam Montana said:

Yo Snap - Oil Is Down To Only One Penny ?  

 

 

We Probably Could Buy A Few Tankers Worth With Our Dinar ...

 

 

     

 

[DinarThug]

A former oil minister talks about a simple paragraph that saves Iraq $ 3 billion annually if it were applied!

 

2020-04-20

 

 

 

Yassin Iraq: Baghdad

Former Oil Minister Amer Abdul Jabbar revealed a paragraph on the oil produced and its derivatives and what Iraq needs to import due to the lack of improvement of refineries, which costs Iraq $ 3 billion annually.

"Our old refineries produce 50 to 60% naphtha / gas / white oil and the rest are black oil, while modern refineries produce 95% white products and 5% black oil," Abdel-Jabbar said in a tweet monitored by Yassin Iraq.

He indicated that “it does not produce gasoline but rather octane naphtha number 75, and octane number 95 is imported and mixed.” He pointed out that “the cost of a gasoline improvement unit is equivalent to 200 million dollars, so we avoid importing gasoline at 3 billion dollars annually.”

LINK

[DinarThug]

I Think That Iraq Now Has Them Over A ‘Barrel’ !  

 

     

 

 

LINK

Iraq is negotiating with foreign companies to reduce costs of producing oil

 

20th April, 2020

The advisor to the Prime Minister for Economic Affairs, Abdul Hussein Al-Hanin, announced on Monday that Baghdad was ready to negotiate with foreign oil companies to reduce production costs by 30 percent without affecting production levels.

Al-Hanin said in a press statement that was followed by "Al-Iqtisad News", that "the government entrusted the Ministry of Oil with entering into negotiations with foreign oil companies operating in Iraq to reduce production costs and operational budgets without affecting production levels."

He added that "the aim of this comes in order to maximize profit for each barrel of product, expected that the Ministry of Oil negotiations will be crowned with success in reducing costs, especially that international companies have an interest in joint cooperation with the Ministry of Oil in particular, and the Iraqi government in general."

[DinarThug]

LINK

Kurdistan must bear part of the economic fallout

 

09:21 - 20/4/2020

 

The second deputy speaker of the House of Representatives, Bashir Al-Haddad, announced on Monday that the Kurdish delegation that arrived in Baghdad yesterday will discuss with the central government issues of reducing oil production and financial and economic files, stressing that the repercussions left by those crises must bear part of the region.


Al-Haddad said in statements followed by the information: “The current conditions the country is passing through in particular, and the countries of the world in general, due to the drop in oil prices and the outbreak of the Corona pandemic require that coordination, cooperation and dialogue between the central government and the region be ongoing, and it is very important at this stage for consensus On the important points between the two parties, especially since the Kurdistan Region is part of Iraq.

He added, "The delegation of the region that arrived in Baghdad today will discuss energy files, financial and economic issues and reduce oil production in line with the decisions of OPEC," expecting "the success of these negotiations as they are in the interest of the Iraqi people as a whole and the Kurdistan region in particular."

And that "the repercussions left by those crises must bear part of the region. Therefore, the negotiations aim to cooperate to reduce the effects of that crisis and improve the financial and economic situation of the country in light of the spread of the Corona pandemic and low oil prices."

Al-Haddad indicated that "the delegation is headed by the Minister of Finance in the territorial government, membership of the ministers of planning and territory for federal affairs, head of the Cabinet office and head of the legal department in the region's cabinet." 

[DinarThug]

Iraqi economist: Do not stand by .. OPEC agreement failed, and Iraq is awaiting a 'complex deficit'!

 

04/1920 2020 06:09:36 PM

 

Baghdad - people

 

On Sunday, economist Ahmed Sobeih warned of an economic collapse in Iraq, stressing that the OPEC agreement failed to raise oil prices.

Sobeih said in a post followed by "People" today (April 19, 2020) that "the (OPEC +) agreement did not help the oil market towards raising the price of its oil barrel, but that the pessimistic trends of the length of the economic recession outperformed the decisions of this group and led the current and future oil prices" To a further decline, which means recording a compound deficit in the budgets of rentier countries, which must search for urgent economic policies to ward off the risks of an economic collapse standing on the door. "

He added, "The impact of this will be more severe on the Iraqi economy, which depends on oil revenues to finance its budget by more than 90%, and against this collapse, the negative effects will multiply to constitute a complex financing shock, the most important part of which is related to the low price of its oil (an external variable that cannot be controlled) Pointing out that "the other part is related to the reduction of its market share (the other is an external variable imposed upon it by the OPEC + agreement), as well as the combination of the wrong economic policies that accompanied the general performance of the state."

Sabih noted, "According to the prices announced in the global oil market, Iraqi oil barrels are sold these days at a price of 25 dollars (which is lower than the standard Brent mix price, which is sold at 28 dollars per barrel)," stressing that "this means that the total oil revenues will It will not exceed (65) million dollars per day (23.4) billion dollars annually, after it was calculated in the 2020 budget by (255) million dollars per day (92) billion dollars annually before the Corona pandemic, with a decrease of more than 74%. "

He continued, "This means that a new fiscal deficit of $ 68 billion will be added to the planned deficit in the 2020 budget of ($ 40 billion), bringing the total deficit to a new Iraqi record of about $ 108 billion, and this deficit constitutes 75% of The size of the budget is inconsistent with all normative economic and financial principles. "

Sobeih stressed, "The need to consult economists to provide urgent studies and financial and monetary treatments that start from the nature of the Iraqi economy and coexist with the current reality the global economy is going through, otherwise we await an economic epidemic that outweighs the impact of the highest and most severe epidemics."

After the Corona pandemic, there is an oil price war leading to the agreement to reduce production, successive strikes that have deepened the economic and economic crisis in Iraq, and limited it to ways of overcoming the large deficit in its budget for the current year 2020.

While the deficit is estimated at about 90 billion dollars, the government of the resigned Adel Abdul Mahdi seeks to search outside the borders for solutions that prevent any internal turmoil, especially after much talk has been raised about a serious threat to the salaries of employees.

Yesterday, in a meeting held under the chairmanship of Finance Minister Fouad Hussein to discuss the crisis, the highest economic officials in the country considered "the option of borrowing from abroad to cross the stage" as stated in an official statement, after they discussed the oil price crisis, on which Iraq depends on about 95% of its financial resources .

Despite the agreement of OPEC + members to reduce production by 10 million barrels, oil prices are still declining, to reach under the twenty dollars for US crude.

In this context, economist Majed Al-Suri assures that this option will not be easy, as the International Monetary Fund previously loaned Iraq without paying all of these loans, which means that it is difficult to borrow from it again, stating that "any loan that the International Fund can grant to Baghdad will not exceed two billion dollars." , While the fiscal budget deficit of 2020 amounts to 90 billion dollars. "

At the same time, he adds that the image of borrowing from the inside is also difficult at the present time, as the value of previous loans with state debt is about 36 trillion dinars.

"A Warning from Madness: Catastrophe on the Horizon!"

In his interview with "NAS" today (April 19, 2020), the figurehead expert points to a disaster that appears clear to him, on the horizon of Iraq, unless quick steps are taken to avoid it, specifically "to inventory the funds available in the state treasury and turn them into efforts to confront the Corona virus and help The poor, in addition to allocating operational expenses in general, the most important of which are the salaries of senior employees and reducing their benefits and allocations as "solutions that there is no other to overcome the impasse, otherwise it warns of" social unrest as a result of the economic crisis. "

For her part, economist Salam Semsem agreed with Al-Suri on the necessity of finding internal solutions, while describing the government's intention to borrow from abroad as a "crazy move."

Sumaisem said in her interview with "People" that "the government has previously charged Iraq with debts, and is now trying to negotiate with the International Monetary Fund and the World Bank to obtain forgiveness (from paying the debts), and it will be worth $ 10 billion if it was approved," adding that "the government You should think about internal measures that reformulate economic policy, not measures that foster indebtedness and economic failure and increase the budget deficit. "

And it warns that the policy of borrowing from the harsh "is a messy, irrational and wise move because it sacrifices the interests of Iraq and its economic future."

"Eye on salaries!"

Meanwhile, unconfirmed information officially indicates that the three presidencies agreed to a proposal submitted by the Parliamentary Finance Committee to deduct part of the employees ’salaries, starting from the lowest levels and up to the three presidencies, provided that they are paid back to them later after the recovery of oil prices and finding funding sources Others, but the Parliamentary Committee denied making such a proposal.

Today, committee member Jamal Cougar said in a press statement that Nass followed that "resorting to the compulsory saving of employee salaries is one of the solutions proposed to overcome the crisis."

He adds that "the state does not have many alternative solutions, as maximizing resources is not an easy process in record time, which makes the state in front of limited options, including resorting to bank reserves and borrowing from Iraqi banks."

While 6.5 million government employees and retirees receive monthly salaries from the state, 20% of the Iraqi people live below the poverty line, according to a survey conducted by the Ministry of Planning at the end of 2018, and no similar has yet taken place yet.

And not far from the economic side, MP Muhammad Iqbal, the pharmacist, confirmed on Sunday the "expansion" of the international coalition against China against the background of accusations leveled against it on the Coruna virus.

The pharmacist said in a post, seen by "NAS" (April 19, 2020), that "the international alliance to sue China is expanding gradually, Britain and France are joining America and soon Germany, Italy, Spain and others, if it is proven that China is involved in the leak of Corona virus."

The pharmacist pointed out that "the Chinese economy will mostly be mortgaged to pay compensation and China will shift from the number one country in economic growth to another kind of country."

LINK