OPEC+ talks collapse; oil futures tank

The Oilholic had to leave OPEC HQ prior to the conclusion of a rather fractious OPEC+ meeting which resulted in no agreement being reached among OPEC and its non-OPEC partners. Following are the key takeaways, from Vienna Airport:

• Russia blocked OPEC efforts aimed at deepening ongoing OPEC+ cuts by 1.5 million barrels per day (bpd) raising the output cut level to 3.2 million bpd to the end of 2020.
• Stalemate means current level of cuts are set to expire as of April 1, 2020.
• Russian Oil Minister Alexander Novak even refused name/set date for next OPEC+ meeting; technical committee to meet on March 18.
• Senior OPEC sources tell this blogger “There is no plan B”.
• Oil benchmarks slump by as much as 8% in the immediate aftermath of the development and trading down by ~10% at the time of writing; Brent/WTI front-month contract at levels last seen in August 2016, and recorded largest intraday drop since the financial crisis. 

More considered viewpoints/analysis to follow once yours truly has arrived in Houston. Keep reading, keep it ‘crude’! 

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To email: gaurav.sharma@oilholicssynonymous.com

© Gaurav Sharma 2020.

Events overtaking OPEC as 1mbpd+ cut deepening is touted

After a meeting that went long into the night, OPEC+ is in for another hectic few days of haggling as it works out how to respond to the demand slump being caused by the coronavirus outbreak. 

OPEC+ technical committee's recommendation was for an expansion of its ongoing cuts of 1.2 million barrels per day (bpd) by 600,000 bpd.

But before the evening was done last night, a number as high as 1-1.2million bpd was being touted around, something that has held firm for much of this (Mar 5) morning and afternoon. Quite frankly, events have overtaken OPEC and demand forecasters are shooting blind at the moment, as the Oilholic noted via Forbes at IPWeek. 

But given the global proportions of the coronavirus spread, potential for $30 per barrel prices and demand growth shrinkage, Wall Street is finally waking up to the magnitude of the demand destruction that could happen. Here's yours truly's latest Forbes take on the subject. 

Lets see how the day unfolds. But for a deepening of that magnitude Saudi Arabia's headline production will have to drop below ~9 million bpd; and should that happen it'll be a bit of whopper facilitated by Saudi Crown Prince and Powerbroker-in-chief Mohammed Bin Salman! Keep reading, keep it 'crude'! 

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© Gaurav Sharma 2020. Photo: Ministerial Limos arrive at OPEC Secretariat in Vienna, Austria © Gaurav Sharma, Mar 5, 2020. 

Crude arrival in Vienna in the age of Coronavirus

The Oilholic has arrived in Vienna for the 178th 'Extraordinary' meeting of OPEC Ministers, only to be told that analysts and journalists will not be allowed into the Secretariat to mitigate chances of the spread of the coronavirus.

It seems the conference and its goings-on would be 'live streamed', and all of us would be moved to the confines of a meeting room at the Palais Hansen Kempinski with no media briefings and contact with oil ministers. Still old friends and diehards have turned for some outdoor coffee and cookies outside OPEC HQ.

More diehards outside #OPEC HQ this afternoon than the number of people on my flight in to Vienna from London yesterday afternoon! pic.twitter.com/SI1ZtIFutp

— Gaurav Sharma (@The_Oilholic) March 4, 2020

No handshakes at #OPEC with @eithnetreanor in the age of the #CoronavirusOubtreak; we settled on a 'crude' but friendly elbow nudge :) #OOTT #oilandgas pic.twitter.com/hgO2mAEf9h

— Gaurav Sharma (@The_Oilholic) March 4, 2020

 And here's the agenda for the next few days:

Schedule of #OPEC+ 'live streaming' starting soon at a laptop near you! #OOTT #oilandgas pic.twitter.com/Q3TYsyhAwR

— Gaurav Sharma (@The_Oilholic) March 4, 2020

That's all for the moment folks! More from Vienna soon; but in the interim, keep reading, keep it 'crude'!

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To email: gaurav.sharma@oilholicssynonymous.com

© Gaurav Sharma 2020.