Oil and Gas Market Summary 9/26/16 from OilPricesDaily.com

Oil Prices Daily

Oil prices daily podcast discusses all of the news, events, and trends influencing oil prices each day.

Be sure to visit today’s oil prices daily newsletter for links to all news stories and sources mentioned in this podcast.

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Links:

OPEC divided on production cut before Algiers talks – Bloomberg

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Transcript:

Hello, and welcome to the Oil Prices Daily podcast. Doug Stetzer here bringing you your daily recap of all the latest news, events, and trends influencing oil prices.

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Okay, so let’s talk about what’s happening in oil prices for today, September 26.

It’s a Monday. Of course, the event we’ve all been waiting for for the last few weeks, the OPEC meeting in Algeria has begun.

Headlines are coming out, and it looks like it’s going to be a bit volatile until we really find out what’s happening here and get anything conclusive.

On the heels of Friday’s down 3% session the market was back up 3.3% today, trading up $1.45 to settle at $45.93.

Trading volume, however, was light with just over 800,000 futures contracts trading. That’s showing on the CME right now.

It might bounce a bit but, as we know, these days anything under a million is a really light session, so up sharply on not a lot of volume. Technically, what has happened is that anything between say 44 1/4 and 46.50, which was just Friday’s range, has kind of become a no-man’s land right in the middle of this wedge formation that we are consolidating in.

If you look at the Oil Prices Daily newsletter, we’ve go a chart in there for you on the daily chart, a couple of trend lines drawn just to kind of emphasize what’s happening when you get this lack of direction, markets, really not sure where to go in this middle of the range, waiting for headlines and waiting for any real news to give it some direction.

Of course, we might not get it, and we’ll just have to wait and see what happens after this meeting.

As far as news is concerned … Of course, everything OPEC dominated there’s a number of stories in the newsletter just to give you some links to some of the things that I was finding out there; however, when it really comes down to it, freeze or no freeze, are oil prices going to go up or down?

We’re chomping around in a 3% range, prognosticators are talking. They’ve got a 50/50 guess they’re going to take a draw along this hand here, but it’s just chatter. They’re analyzing every handshake, and wink, and nod coming out of the meeting, but nobody really has any insight.

That being said, some of the stories I saw that were interesting, Iran playing down prospects of an OPEC deal, so Iran really seems to be playing it cool as they go into this meeting.

As we mentioned on Friday, that Saudi Arabia had extended the possibility of freezing at earlier levels. One of the stories I saw today, no sign of a freeze at home for Russia, kind of mentioning that Russia’s playing this game, as well, but that no oil company executives have been contacted by Putin, not that he really has to ahead of time, but there’s really no discussion in the domestic industry about freezing production there.

One quote coming out of that story, which I tend to agree with is that,

“We think it is impossible to agree. No one trusts anyone. Everyone has just been ramping up production within OPEC and outside.”

Again, really wait-and-see mode, and we’re just going to have to see what happens here.

Probably my favorite story that I came across today is on Bloomberg, again, of course, the link is in the newsletter. “OPEC divided on production cut before Algiers talks.”

They’re really highlighting this idea that they could freeze, they could cut, or nothing; however, they have a really interesting breakdown basically of all the countries in OPEC, or at least the major producers in OPEC, and really some specific details about their current economic situation, political situation, and some of the things they are expecting to get out of this, maybe what their individual production is.

They have little paragraphs on Algeria, Angola, Ecuador, Iran, Iraq, Libya, Nigeria, and Saudi Arabia, Venezuela, Russia. Just a little bit of specific detail on each one of these countries I thought was really interesting.

They also have a nice chart on where they stand as far as share of global oil production, break-even oil price, and financial reserves as of 2015, and how much those have either increased or decreased.

That’s probably my favorite article for today, the most insightful, not really trying to make a call on what would happen with this freeze or anything like that, just throwing out some actual information.

As far as the rest of the week is concerned, of course we’re going to get a couple more days of OPEC and another interesting EIA week.

We will see if the EIA continues to confound analysts with their supply numbers, and we’re just really waiting to see if these draws continue and if that lends support to this market for more than just a couple of days, if anything long-term can come out of that.

We will wait and see and we’ll stay tuned as these things start to play out this week.

Of course, it is worth mentioning that tonight is the first debate between Hillary Clinton and Donald Trump in the U.S. Presidential elections, kicking off what’s sure to be a crazy season as we head towards the election in November.

That will be happening before the next OPEC meeting. Of course this is a big deal. We’ll see how that starts to play out as headlines come out of here.

It’s going to be a wild one, so stay tuned.

Get our concise recap of all the news and events that are influencing oil prices each day by going to oilpricesdaily.com and signing up.

Of course, you can also subscribe to this podcast on iTunes. Thanks for listening. Have a good day.

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