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Credit deflation and the reflation cycle to come (part 2)

spunko

By spunko
in Property Prices & Economy

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Democorruptcy

Democorruptcy

Posted
Posted
45 minutes ago, Barnsey said:

Holy shit grab the popcorn

 

Saudi Arabia kicked off an all-out oil war on Saturday, slashing official pricing for its crude and making the deepest cuts in at least 20 years on its main grades, in a bid to push as many barrels into the market as possible.

The cuts in monthly pricing by state producer Saudi Aramco are the first indication of how the Saudis will respond to the breakup of the alliance between OPEC and partners like Russia. The kingdom plans to accompany the price cuts with a hike in crude supply, according to people with knowledge of the situation.

https://www.bloomberg.com/news/articles/2020-03-07/saudi-aramco-slashes-crude-prices-kicking-off-price-war

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DurhamBorn

DurhamBorn

Posted
Posted
3 minutes ago, Democorruptcy said:

Saudi Arabia kicked off an all-out oil war on Saturday, slashing official pricing for its crude and making the deepest cuts in at least 20 years on its main grades, in a bid to push as many barrels into the market as possible.

The cuts in monthly pricing by state producer Saudi Aramco are the first indication of how the Saudis will respond to the breakup of the alliance between OPEC and partners like Russia. The kingdom plans to accompany the price cuts with a hike in crude supply, according to people with knowledge of the situation.

https://www.bloomberg.com/news/articles/2020-03-07/saudi-aramco-slashes-crude-prices-kicking-off-price-war

Its a thing of utter beauty.It would make things so much easier if oil could collapse and force the big oilies straight down.Shell at £12?,lets hope so.Wonder how long the Saudi's can pump at sub $30 oil.Not long,but it might make the run up in a few years even stronger.Hope the transports hedging department is getting busy tomorrow.

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TheCountOfNowhere

TheCountOfNowhere

Posted
Posted
1 hour ago, Cattle Prod said:

Doesn't sound like chaos to me, a few thousand people out of 16m wanted to go south. That could be accounted by 35 year old sons who need their mama alone! It's really interesting how things are reported, and interpreted.

A few thousand possibly infected selfish twats head south.

It is interesting, the media are notching it up. 

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Barnsey

Barnsey

Posted
Posted
11 minutes ago, DurhamBorn said:

Its a thing of utter beauty.It would make things so much easier if oil could collapse and force the big oilies straight down.Shell at £12?,lets hope so.Wonder how long the Saudi's can pump at sub $30 oil.Not long,but it might make the run up in a few years even stronger.Hope the transports hedging department is getting busy tomorrow.

Can only imagine the supply squeeze on the other side of this if sub $40 is sustained, next point of focus will be the possible bailing out of shale under “agriculture”

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DurhamBorn

DurhamBorn

Posted
Posted
1 minute ago, Barnsey said:

Can only imagine the supply squeeze on the other side of this if sub $40 is sustained, next point of focus will be the possible bailing out of shale under “agriculture”

The lags will come into play.Hopefully the transports get hedging.Tobacco also does really well when fuel is cheap in the US,so they would be a buy on weakness.Big oil will turn their shale off i expect in this price point.I expected oil below $20 in the debt deflation for a short period,might we be in it now?.Id be happy if i get positioned this week in oil and take any falls after that on the chin.

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TheCountOfNowhere

TheCountOfNowhere

Posted
Posted
23 minutes ago, Cattle Prod said:

I'm not sure what surplus ING is seeing. The last time WTI went to $30, there was a 250m barrel surplus in US inventory over the 5 year average. A real glut. Last week, the inventory was negative by ~ 1m bbl below the 5 year average. It will build a little as the temporary demand drop filters through, but not nearly by that much. Any price drop to this region will be sentiment only. I love buying on negative sentiment.

Maybe they see a situation where millions of people sit in the house for months 

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Chewing Grass

Chewing Grass

Posted
Posted
30 minutes ago, Cattle Prod said:

I'm not sure what surplus ING is seeing. The last time WTI went to $30, there was a 250m barrel surplus in US inventory over the 5 year average. A real glut. Last week, the inventory was negative by ~ 1m bbl below the 5 year average. It will build a little as the temporary demand drop filters through, but not nearly by that much. Any price drop to this region will be sentiment only. I love buying on negative sentiment.

 

5 minutes ago, TheCountOfNowhere said:

Maybe they see a situation where millions of people sit in the house for months 

Yep,

30 Apr 2018In the U.S., oil supplies were running 1.1 million barrels lower at the start of this summer's driving season (which runs from April through September), than a year ago.

Driving season may be put off a bit this year.

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Barnsey

Barnsey

Posted
Posted
27 minutes ago, Cattle Prod said:

Precisely - that is sentiment. It might become true, but I am seeing that as low probability.

How much of a dent do you think this’ll make?

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