The Oil Price Collapse Is Yet Another Sign That Economic Activity Is Crashing Dramatically All Over The World

(Michael Snyder) The insanity that we are currently witnessing in the financial markets is difficult to believe.  Personally, even though I operate a website called “The Economic Collapse Blog” and I write about these things every day, when someone told me that the price of oil had fallen below minus 30 dollars a barrel on Monday I initially didn’t think that it could possibly be true.  Yes, I always knew that it was theoretically possible that the price of oil could go into negative territory, but we had never seen such a thing actually happen before.  And I knew that a crunch was coming as futures contracts expired, but I certainly did not expect the extreme carnage that we witnessed on Monday …

The post The Oil Price Collapse Is Yet Another Sign That Economic Activity Is Crashing Dramatically All Over The World appeared on Stillness in the Storm.

One-Two Punch: Coronavirus, Price War Sends Oil Prices to 18-Year Low

(Franz Walker) The economic slowdown brought about by the global coronavirus pandemic, compounded with the price war between Saudi Arabia and Russia, has sent oil prices into an 18-year low Monday. This was crude-oil future’s biggest percentage drop on record for any month or quarter, according to Dow Jones Market Data analysis, since 1983.

The post One-Two Punch: Coronavirus, Price War Sends Oil Prices to 18-Year Low appeared on Stillness in the Storm.

Corruption EXPOSED: Shell Oil Corporation Burning Gas For Months Because They Can’t Sell It

(John Vibes) The Shell oil corporation is burning off large volumes of ethane because they can’t sell it to their regular customer, which is a plant on the same property owned by ExxonMobil. The location is officially known as “Mossmorran,” and is used by numerous oil and gas companies. Residents near the property where the ethane is burning are complaining of pollution, light, and noise coming from the site.

The post Corruption EXPOSED: Shell Oil Corporation Burning Gas For Months Because They Can’t Sell It appeared on Stillness in the Storm.

Oil breaches $70 a barrel

Global demand for oil is expected to rise, helping push oil prices higher [Xinhua]

For the first time in more than three years when oil prices first took a dive, Brent crude hit $71 a barrel on Thursday on news that inventories had fallen again in the US.

US benchmark West Texas Intermediate crude futures rose to $66.53.

Oil markets have been steadily rising since Saudi Arabian-led OPEC agreed to oil production cuts with non-cartel world producers such as Russia.

And OPEC is predicting rising global oil demand over the next four years will push prices even higher.

The two largest oil producers agreed to continue with production cuts until the end of the 2018 fueling hope among some traders that oil prices could head toward the $80 mark by the end of the year.

Saudi Arabia’s most pivotal step in the oil markets has been its ability to coerce OPEC and non-cartel members to stick to the 1.8 million barrels a day production cuts since last year.

Hand in hand with the Russians, this has been one of the leading factors on boosting oil prices in 2017.

The two countries, once at loggerheads over Syria and Iran, have set aside their differences in favor of oil market stability.

2017 began with oil prices climbing in the $45-55 range to end the year near $67 a barrel.

With Saudi Energy Minister Khalid Al Falih pledging that oil cuts will continue till the end of 2018, the Saudis were hoping for a price range between $60 and $70 a barrel for much of the year.

Prices have now surpassed that and are likely to hover between $65 and $75. But could they go higher?

Supply and demand

While the biggest threat to market stability is how quickly shale oil production will be back on line now that oil company coffers are filling up again, expectations are that demand for the black gold is not going to stop rising.

According to a report from the International Energy Agency on January 19, 2018, global demand for oil has risen from 92.45 million barrels a day in Q2 of 2014 (when the glut first began) to 96.65 million barrels in Q3 of 2016.

In 2018, the IEA forecasts global demand at 99.1 million barrels a day.

However, the IEA says that rising oil prices may offset demand and push it lower slightly.

Meanwhile, OPEC says that it sees a healthy annual increase in global demand to reach over 102 million barrels a day by 2022.

By Firas Al-Atraqchi with inputs from Agencies

In 2018, kiss the oil glut good bye

Saudi Arabia’s Energy Minister Khalid Al-Falih told reporters in early December that OPEC will monitor oil output and production to ensure that the agreement to curb output is met by all until the end of 2018 [Xinhua]

If you haven’t heard by now, 2017 ends with oil prices well breaching the $60 a barrel mark leaving producers much more confident as they head into 2018.

This is a boon on two fronts for the world’s biggest oil producers Russia and Saudi Arabia.

The Russians over the past three-and-a-half years have weathered the storm of crude oil prices plummeting from over $100 a barrel to $26 a barrel at one point.

To make matters worse, they were hit with punitive EU and American sanctions over the Ukraine crisis at the same time leaving their economists struggling to find an alternative path for economic growth.

After a number of state and banking interventions, the Russians were able to bounce back from the recession zone in late 2016, and from March of 2017 largely because they had rearranged their economy and based it on the $40 threshold.

The little momentum on the Ukraine tract since US President Donald Trump came into the White House and with Russian President Vladimir Putin’s successful intervention in the Syrian war, the rise in crude oil prices is only set to strengthen Russian influence in the Middle East and beyond.

Similarly, Saudi heir apparent Mohammed bin Salman consolidated his power base in the Kingdom with higher oil prices now only likely to boost the Saudi economy and that of many Arab Persian Gulf countries.

In the interim, this will serve his ambitious socio-economic and political reforms in the works for 2030.

Saudi Arabia’s most pivotal step in the oil markets has been its ability to coerce OPEC and non-cartel members to stick to the 1.8 million barrels a day production cuts since last year.

Hand in hand with the Russians, this has been one of the leading factors on boosting oil prices in 2017.

The two countries, once at loggerheads over Syria and Iran, have set aside their differences in favor of oil market stability.

2017 began with oil prices climbing in the $45-55 range to end the year near $67 a barrel.

With Saudi Energy Minister Khalid Al Falih pledging that oil cuts will continue till the end of 2018, oil prices are likely to range between $60 and $70 a barrel for much of the year.

The biggest threat to market stability, of course is how quickly shale oil production will be back on line.

When the oil glut of 2014 hit, some speculated that Saudi Arabia had orchestrated the drop to stall shale oil research and development.

Whether the Saudis can take credit or not, big oil retreated from shale production over the past three years.

Will they make a comeback?

Any such threat will likely be offset by geopolitical instability in the Middle East.

The Saudi-Lebanese rift rattled markets in late November, and now tensions in major producer Iran – if prolonged – will likely do the same.

That’s yet another plus for the Saudis who are expected to sell shares of their oil giant Aramco to much public appeal and fanfare this year.

And it hurts none that their main rival in the region Iran is feeling the domestic heat.

By Firas Al-Atraqchi for The BRICS Post

China Moves on New World Order: Will Buy Oil with Gold-backed Currency—bypassing Us Petrodollar


(Jay Syrmopoulos
Beijing, China – In an effort to hedge against U.S. hegemony, and what could be a global game-changer, the world’s top oil importer, China, is preparing to denominate crude oil futures contracts in Chinese yuan to be convertible into gold. The move would allow oil exporting countries to bypass benchmarks denominated in U.S. petrodollars — creating what will almost certainly be the most critical Asian oil benchmark, according to a report by Nikkei Asian Review.
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