oil prices

Not Only Rates But Also Oil Prices Can Go Negative

Julius Baer | The oil market continues to write history. The past days and weeks brought us an unprecedented demand collapse, unprecedented oil politics and the absolute novelty yesterday: negative oil prices. The US benchmark West Texas barrel sank by -305% and became negative at -37.63 $/b. Before you rush to the petrol station, negative prices are a temporary glitch reflecting stressed flows in the futures markets and stressed storage conditions somewhere in the US Midwest.


Saudi Arabia And Russia: Who Will Back Down First?

Eirini Tsekeridou (Julius Baer) | Oil prices have declined massively over the last weeks, as Russia and Saudi Arabia could not reach an agreement regarding output cuts. Saudi Arabia is trying to punish Russia, while Russia is seeking to hurt US oil producers due to US sanctioning of Russian companies. US shale producers, especially the highly leveraged ones, will face default as their breakeven price is about USD 50 per barrel.



What US-Iran tensions mean for investors

Neil Dwane (Allianz) | The financial markets are signalling that the situation in the Middle East won’t get out of hand, but US-Iran friction could continue for some time. The defence industry and oil and gas-related sectors could remain well-supported, but overall we believe investors should be cautious yet patient. Look to higher-quality stocks with lower correlations to the broader market and “hunt for income” if headline volatility is a risk you wish to avoid.


Oil: dipping below USD 60 as fears become fact

Oil: Political markets have short legs

Norbert Rücker (Julius Baer) | Oil prices sold off more than 4% as concerns about supply risks in the Middle East calmed. The latest actions and reactions show that both opponents, the United States and Iran, are shying away from a military escalation out of fear of its potential economic costs. We stick to our Neutral view on oil and see oil prices lower towards year end. Demand should remain soft amidst weak growth, while supplies increase from Canada to the North Sea.


US is more relaxed about oil spike than Europe – which helps explain differences over Iran

Mueid Al Raee (The Conversation) |Whether or not the Americans actually want higher oil prices, there are certainly good economic reasons why they probably won’t mind them. Deepening the chaos that started with the US withdrawing from the West’s nuclear deal with Iranis an “easy” way to achieve higher oil prices while meeting other strategic objectives. Yet how the Europeans, China and Russia respond will also determine the global flow of oil from Iran and Iraq.


Oil: 2020 Spells Geopolitics For Energy

Norbert Rücker (Julius Baer) |  The oil market is off to a rocky start as the tensions between the United States and Iran escalate. The situation brings lots of uncertainty and geopolitical tea-leaf reading on reactions. While the closure of the Strait of Hormuz remains a very unlikely event, the deterioration in Iraq bears supply risks. Geopolitics tend to be a temporary force on oil markets and we believe this time is no different. We raise our near-term forecast to USD 65 per barrel, and maintain a Neutral view on oil.

 



Oil: dipping below USD 60 as fears become fact

Oil Prices: Dipping Below 60 $ As Fears Become Fact

The Corner | For the second time this month, oil prices dropped below 60 $ per barrel. Growth concerns and a bearish market mood drove the latest sell-off, but fundamentals are now adding to the price pressure. US oil inventories swelled unexpectedly and led to a drop in oil prices.