Connect with us

Business

Oil Prices Hit $15 For The First Time In 21 Years – OilPrice.com

Published

on



Oil Prices Hit $15 For The First Time In 21 Years | OilPrice.com

Michael Kern

Michael Kern is a newswriter and editor at Safehaven.com, Oilprice.com, and a writer at Macro-Investing.com. 

More Info

Trending Discussions

    Premium Content

    Oil Prices Low

    A gruesome combination of crumbling demand for crude and global storage filled to its brim has pushed oil prices to levels not seen in over two decades.

    U.S. benchmark, West Texas Intermediate, has fallen to the $15 range as global economies remain on lockdown due to the COVID-19 pandemic, crushing crude demand. To add insult to injury, global oil storage is reaching its limits. The situation is so dire, in fact, that the Department of Energy is even considering paying domestic oil producers to keep crude in the ground.

    Just. this Wednesday, the International Energy Agency reported a record 19 million barrel increase in domestic crude oil supplies.

    Not even OPEC has been able to provide any relief for the ailing industry. While the cartel and its global partners were able to agree upon a 9.7 million barrel per day cut, the market clearly thinks it’s not enough.

    Vandana Hari, founder of Vanda Insights, a firm specializing in oil market analysis, noted, “The current prices show that the OPEC+ cuts proved to be a blip, with oil prices at the mercy of the virus once again,” adding that “Until we approach a lifting of the lockdowns in the U.S., oil may drift lower or remain rangebound around current levels.”

    Related: Saudi Arabia Slashes Asian Oil Exports By 2 Million Bpd

    The oil price collapse is sending shockwaves throughout the entire industry, with oil majors slashing spending across the board, and explorers cutting as much as 13 percent of their drilling fleet as the crisis rages on.

    The troubling times have even forced the Texas Railroad Commission to consider the unthinkable, mandate a state-wide production cut. While the three commissioners were unable to come to a decision last Tuesday, the group is set to meet again on April 21st. And with oil prices having fallen an addition 20 percent since their last meeting, they might just be ready to take action.

    Even if the RRC follows through with their plan to interfere with the free markets, however, many experts suggest that as much as 20-30 million barrels per day in demand is being decimated by COVID-19 – a far cry from what global oil producers have cut so far.

    By Michael Kern for Oilprice.com 

    More Top Reads From Oilprice.com:

    Download The Free Oilprice App Today


    Back to homepage

    <!–

    Trending Discussions

      –>

      Related posts

      Let’s block ads! (Why?)



      Source link

      Business

      Canada's mortgage insurer tightens rules as it forecasts home-price drop of up to 18% – Financial Post

      Published

      on


      TORONTO — The government-backed Canada Mortgage and Housing Corp said on Thursday it would tighten rules for offering mortgage insurance from July 1, after forecasting declines of between 9 per cent and 18 per cent in home prices over the next 12 months.

      The move would make it harder for riskier borrowers, who offer down payments of less than 20 per cent, to access CMHC’s default mortgage insurance.

      CMHC is establishing a minimum credit score of 680 instead of the current 600, the group said in an emailed statement.

      It will also limit total gross debt servicing ratios to its standard requirement of 35 per cent of annual income, compared with a threshold as high as 39 per cent currently, and total debt servicing to 42 per cent versus as much as 44 per cent now.

      The measures will help curtail “excessive demand and unsustainable house price growth,” CMHC Chief Executive Evan Siddall said in the statement.

      He said COVID-19 has exposed longstanding financial-market vulnerabilities, and “we must act now to protect the economic futures of Canadians.”

      Some 35 per cent of Canadian banks’ mortgages are insured, their financial statements show. CMHC is the top mortgage insurer, while Genworth MI Canada and other private companies also provide similar products.

      Despite evaporating activity in the housing market due to the COVID-19 pandemic, prices have continued to rise as listings have fallen off alongside demand.

      Home prices across the country rose 1.3 per cent in April from March, and data from Toronto and Vancouver real estate boards showed increases of 3 per cent and 2.9 per cent in May, respectively, from a year earlier.

      The CMHC has taken a more bearish view of the housing market than others. Last week, some of Canada’s biggest banks forecast maximum price declines of about 7 per cent.

      Siddall last week responded to critics of its more dire outlook, saying on Twitter they were “whistling past the graveyard and offering no analysis.”

      © Thomson Reuters 2020

      Let’s block ads! (Why?)



      Source link

      Continue Reading

      Business

      Canadian Dollar Price Outlook: USD/CAD Grinds Around Big Fig Support – DailyFX

      Published

      on


      Canadian Dollar, CAD, USD/CAD Price Analysis

      • This morning brought a Bank of Canada rate decision, this Friday’s economic calendar brings Canadian jobs numbers to be released at the same time as US Non-Farm Payrolls.
      • The bank held rates, and given the change in leadership the big question is forward-looking strategy at the bank.
      • USD/CAD broke down from a descending triangle formation, and is now finding support around the 1.3500 big figure. But sellers haven’t yet been able to establish any significant trends around that support, leading to the prospect of short-term pullback.

      BoC Leaves Rates Flat, USD/CAD Remains Around 1.3500

      Earlier this morning we heard from the Bank of Canada as the BoC left rates flat; but the prospect of change in leadership atop the BoC does highlight potential changes in the future after outgoing Bank of Canada Governor Stephen Poloz had previously stated that rates were as low as they could go. Taking over at the bank this week is Tiff Macklem, and as noted by our own Thomas Westwater earlier today, this morning’s statement likely had little input from the newly-installed BoC Governor. This does, however, point to the possibility of change on the horizon given how aggressively the coronavirus slowdown has hit global economies.

      In USD/CAD, the pair has largely clung on to support around this rate decision, temporarily testing below the big figure of 1.3500 but, so far, failing to establish any continued bearish trends below that level. And this comes on the heels of an earlier-week breakdown, as USD/CAD had built into a descending triangle formation, with a series of lower-highs from late-March into mid-May, combined with horizontal support around the 1.3850 area on the chart.

      USD/CAD Four-Hour Price Chart

      USDCAD Four Hour Price Chart

      Chart prepared by James Stanley; USDCAD on Tradingview

      Can USD/CAD Bears Drive Through Psychological Support?

      Of recent, commodity currencies have been on a tear against the US Dollar, USD/CAD included. AUD/USD has been on a similar display of recent and the same can be said for NZD/USD.

      The trouble at this point for USD/CAD bears is the fact that the short-side move is already fairly well-developed; and prices are showing continued support around the 1.3500 big figure. Can USD/CAD bring sellers in at sub-1.3500 prices to continue pushing lower? Or, will the pair need a retracement first before continuing that bearish trend?

      Change in Longs Shorts OI
      Daily-2%-5%-3%
      Weekly-9%-13%-10%

      On the chart is a nearby area of interest for resistance potential. As looked at in yesterday’s webinar, the space around the 1.3600 area seems especially interesting, as there are two very recent Fibonacci levels within close proximity of each other. This is the 61.8% retracement of the 2020 major move, and the 78.6% retracement of the March major move. At this point, that zone hasn’t yet been tested for resistance and a show of sellers here could re-open the door for bearish continuation strategies in the pair.

      USD/CAD Hourly Price Chart

      USDCAD Hourly Price Chart

      Chart prepared by James Stanley; USDCAD on Tradingview

      — Written by James Stanley, Strategist for DailyFX.com

      Contact and follow James on Twitter: @JStanleyFX

      Let’s block ads! (Why?)



      Source link

      Continue Reading

      Business

      Canadian trade plummets amid global shutdowns – BNNBloomberg.ca

      Published

      on


      Canadian exports and imports plunged by the most ever in April amid a shutdown of global trade.

      Exports plunged 30 per cent during the month, more than offsetting a 25 per cent drop in imports. The nation’s trade deficit widened to $3.3 billion ($2.4 billion), from $1.5 billion in March. The median estimate of economists surveyed by Bloomberg had called for a $3 billion shortfall.

      The report illustrates the extent to which global trade has collapsed amid pandemic-related lockdowns and travel restrictions. In Canada’s case, the economy is facing a double whammy from the pandemic and tanking oil prices. Combined imports and exports at $68.6 billion were the lowest since 2010.

      Energy exports dropped 44 per cent in April, as the value of crude oil shipments fell 55 per cent on lower prices and lower volumes due to weaker global demand.

      In volume terms, total exports were down 20 per cent in April, with imports falling 25 per cent.

      -With assistance from Erik Hertzberg.

      Let’s block ads! (Why?)



      Source link

      Continue Reading

      Trending