Tag: Oil

An Oil Stock to Ride Out the Looming Recession

Posted on by The INO.com Team

At the moment, the oil market is much like the famous quote from the beginning of “A Tale of Two Cities.”

It is a tale of two markets: the futures market for oil (controlled by Wall Street) and the physical market, which reflects the real-world demand for oil. Both factor in many dynamics inputs, notably whether we’re actually heading into a recession.

Which Tale to Believe?

The price of oil dropped by about $15 a barrel in a few days in the futures market, thanks to recession worries. That pushed the global benchmark Brent crude oil price below $100 per barrel for the first time since April.

However, in the real world, there is no sign of a slowdown in demand for oil. In fact, it’s quite the opposite.

Premiums for the immediate delivery of oil are at record levels. For example, Nigerian Qua Iboe crude oil was offered at $11.50 a barrel above Brent, while North Sea Forties crude was bid at Brent-plus-$5.35—both all-time highs!

Here in the U.S., WTI-Midland and WTI at East Houston traded in June at a more than a $3 premium to U.S. crude futures, the highest in more than two years. And though both grades of oil have since edged off those highs, they are still trading more than 60% higher than at the start of June. Continue reading "An Oil Stock to Ride Out the Looming Recession" →

Energy, Stagflation, and the Fed with Kyle Bass

Posted on by The INO.com Team

Kyle Bass, Founder and CIO, Hayman Capital Management, joins Melissa Francis, former CNBC, MSNBC, Fox Business, and FOX News anchor, to discuss oil, alternative energy and strategies to navigate a stagflation.

Kyle Bass on Magnifi by TIFIN

Watch the Full Interview at Magnifi by TIFIN

Melissa Francis
Welcome everyone. Today, we are here to talk about Magnifi by TIFIN, a marketplace where you can harness real-time proprietary data to help individual investors and financial advisors fund, compare, and buy investment products like stocks, ETFs, and mutual funds, and model portfolios, to grow and preserve your wealth. I'm Melissa Francis, I know a little bit about this subject matter. I'm a former CNBC, MSNBC, Fox Business, and Fox News anchor. There is probably no more important conversation during these volatile times right now than what drives the economy? Joining us today is hedge fund manager and founder of Hayman Capital Management, Kyle Bass.

Kyle, thank you so much for being here. These are really turbulent times, today alone we have just watched the market seesaw. Everybody was ready to, they were sick to their stomach through the whole weekend, waiting for today, but I'm glad to have you on today, because you've made some really key calls in the past during times like this. You made a great call in subprime, China. You've made a lot of great calls in energy. Overnight, as you know, oil hit a 14 year high. This morning, though, oil was trading off as Germany came out and said they are not prepared yet to halt Russian imports. Oil just got slapped on that, but who knows what's going to happen next? What's your take on all of it? Continue reading "Energy, Stagflation, and the Fed with Kyle Bass" →

World Oil Supply And Price Outlook, August 2021

Posted on by Robert Boslego

The Energy Information Administration released its Short-Term Energy Outlook for August, and it shows that OECD oil inventories likely peaked at 3.207 billion in July 2020. In July 2021, it estimated stocks fell by 13 million barrels to end at 2.860 billion, 348 million barrels lower than a year ago.

The EIA estimated global oil production at 97.42 million barrels per day (mmbd) for July, compared to global oil consumption of 98.78 mmbd. That implies an undersupply of 1.15 mmb/d, or 42 million barrels for the month. Given the decrease in OECD stocks, non-OECD stocks are implied to have increased by 29 million barrels.

For 2021, OECD inventories are now projected to draw by net 208 million barrels to 2.819 billion. For 2022 it forecasts that stocks will build by 90 million barrels to end the year at 2.908 billion.

Crude Oil

On July 18th, OPEC agreed to:

“Adjust upward their overall production by 0.4 mb/d on a monthly basis starting August 2021 until phasing out the 5.8 mb/d production adjustment, and in December 2021 assess market developments and Participating Countries’ performance.”

The current “reference production” and adjustments levels are detailed in the table below. Continue reading "World Oil Supply And Price Outlook, August 2021" →

World Oil Supply And Price Outlook, June 2021

Posted on by Robert Boslego

The Energy Information Administration released its Short-Term Energy Outlook for June, and it shows that OECD oil inventories likely peaked at 3.210 billion in July 2020. In May 2021, it estimated stocks rose by 4 million barrels to end at 2.901 billion, 298 million barrels lower than a year ago.

The EIA estimated global oil production at 95.02 million barrels per day (mmbd) for May, compared to global oil consumption of 96.22 mmbd. That implies an undersupply of 1.20 mmb/d, or 37 million barrels for the month. Given the increase in OECD stocks, non-OECD stocks dropped by 41 million barrels.

For 2021, OECD inventories are now projected to draw by net 149 million barrels to 2.877 billion. For 2022 it forecasts that stocks will build by 80 million barrels to end the year at 2.957 billion.

OECD Global Oil Inventories

The EIA forecast was made incorporates the OPEC+ decision to cut production and exports. According to OPEC’s press release June 1, 2021: Continue reading "World Oil Supply And Price Outlook, June 2021" →

World Oil Supply And Price Outlook, May 2021

Posted on by Robert Boslego

The Energy Information Administration released its Short-Term Energy Outlook for May, and it shows that OECD oil inventories likely peaked at 3.210 billion in July 2020. In April 2021, it estimated stocks dropped by 26 million barrels to end at 2.897 billion, 215 million barrels lower than a year ago.

The EIA estimated global oil production at 94.04 million barrels per day (mmbd) for April, compared to global oil consumption of 96.18 mmbd. That implies an undersupply of 2.14 mmb/d or 64 million barrels for the month. That implies non-OECD stocks dropped by 33 million barrels.

For 2021, OECD inventories are now projected to draw by net 168 million barrels to 2.858 billion. For 2022 it forecasts that stocks will draw by 22 million barrels to end the year at 2.873 billion.

OECD Global Crude Oil Inventories

The EIA forecast was made incorporates the OPEC+ decision to cut production and exports. According to OPEC’s press release on April 27, 2021: Continue reading "World Oil Supply And Price Outlook, May 2021" →