Talk Is Really Cheap

Lacking of implementation details

OPEC’s 14 oil producing nations agreed  to modestly cut their collective oil output later this year in an effort to bolster sagging prices, according to a cartel official. The decision sent global oil prices soaring by more than 5 percent. See Link

Since then, we have seen concerns / contradicting developments relating to the planned deal:

Igor Sechin, Russia’s most influential oil executive and the head of state-controlled energy giant Rosneft, said his company will not cap oil production as part of a possible agreement with OPEC. See Link

Libya, Iran and Nigeria have said they aim to pump additional volumes that could total 700,000 barrels of oil a day over August levels. See Link

Details over who will bear the brunt of the cuts are due to be set by end-November but there is already growing wariness among market-watchers about how the deal can be implemented. See Link

Low probability of a deal cutSee Link

Technically, strong resistance is expected for Brent Crude to cross above the $53.0 mark

Brent Oct 2016.png

In spite of a rebound in the brent crude oil price, we continue to see on-going trimming of selected equity holdings in oil and gas counters by Malaysia’s pension fund, EPF in the month of October 2016:

SKPetro.png

BArmada.png

How far can Brent go up? It will ultimately depend on the viability of shale producers (average cost at USD62):

Until there are further concrete plans relating to the production cut, oversupply of crude will continue to persist.

DISCLAIMER: THIS IS A PERSONAL BLOG AND SHALL NOT BE RELIED IN WHATSOEVER MANNER BY ANYONE. ALL ARTICLES CONTAINED IN THIS SITE ARE FOR INFORMATION AND ILLUSTRATIVE PURPOSES ONLY AND DOES NOT PURPORT TO SHOW ACTUAL RESULTS. IT IS NOT, AND SHOULD NOT BE REGARDED AS INVESTMENT ADVICE OR AS A RECOMMENDATION REGARDING ANY PARTICULAR SECURITY OR COURSE OF ACTION. SOURCES USED IN THIS SITE HAVE NOT BEEN INDEPENDENTLY VERIFIED FOR ACCURACY, COMPLETENESS AND TIMELINESS. YOU SHOULD SEEK INDEPENDENT AND PROFESSIONAL INVESTMENT ADVICE IN REGARD TO YOUR INVESTMENT DECISIONS. THE AUTHOR MAY HOLD POSITIONS IN THE SECURITIES OR RELATED INSTRUMENTS MENTIONED ABOVE.

Author: Ken Utau

Markets Observer + Food Lover

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