Showing posts from May 23, 2021

Oil demand for next few decades in China: it shows no sign of abating!

  Although there is plenty of news to make oil investors anxious about their future returns on investments recently, according to the latest analyses the world will still need oil for its survival around 2050, unless a miraculous substitute is around at that time. The above graphs shows how the crude oil demand in China is going to grow in order to meet its energy requirements until 2045; it’s not a graph with a downward trend; on the contrary, it is going up in the absence of a realistic substitute. The trend in India, during the same period, is the same. That means, the world’s second and third largest oil consumers will still be in urgent need of the commodity to power up their respective economic engines. At present, the major oil companies are under tremendous pressure, both from climate activists and politicians, to take measures to reduce carbon emissions; as the world gets closer to the targets set by the global bodies, the calls are only going to get louder and more freq

Crude Oil Markets: OPEC+ meeting next week may not rock the boat

  Crude oil price is back in the green territory, having been volatile for most part of yesterday in light of the data that came from India about its oil consumption – and the inevitable impact on its economy. By gathering data from three major sources, including statistics on the community mobility in the vast country, the EIA, Energy Information Administration of the US, declared the previous day that the way crude oil sector suffered was much worse than expected. The crude oil markets reacted to the grim news and the crude oil price lost the momentum of upward price trend – temporarily; markets cannot ignore the Indian factor, as the country is the third largest crude oil importer – and consumer. Having ridden the Indian tide rather uncomfortably, the crude oil markets now keenly watch the latest OPEC+ meeting, scheduled for next week. The group is meeting on Tuesday, June, 1, to assess the market conditions with respect to the increased output of crude oil. The indications

Sudden fall in oil price: the three simple charts that explain the unexpected

  The crude oil price fell on Thursday by a modest amount despite the presence of encouraging factors that usually bolster it. As this is the case, in order to catch a glimpse of the unexpected, it is worth looking at the latest EIA report, analysing the impact of Covid-19 on the Indian economy in general and petroleum sector in particular. The reports depict a grim cumulative picture – much worse than what we were led to believe. The petroleum consumption is down by 0.4 million barrels per day; the loss of 8% led to the loss of 4million barrels in March and April – a significant loss, indeed. With the findings of the new data, the EIA, the Energy Information Administration, has revised down its own earlier forecast for India up until July. The report cites the way the transport sector came to a grinding halt during the latest wave of the pandemic in India, with a new deadly variant that wreak havoc in much of India; the inevitable result was a steep decline in the consumption of gasol

Revival of 2015 Iranian Nuclear Deal: roller coaster of talks reaches a peak on Wednesday

  The rollercoaster of talks over the JCPOA, 2015 Iran nuclear deal, clearly is not short of peaks and troughs during its arduous journey spanning five distinct phases. In response, the price of crude oil fluctuated wildly during the last few days with misplaced fear about a supply glut due to the arrival of Iranian oil into the markets. On Tuesday, however, there were news-reports indicating that the signatories to the nuclear deal met with a serious impasse during their talks in Vienna; market watchers, understandably, attributed the rise in oil price to this development. On Wednesday, however, optimism returned again from the negotiation team: Abbas Araghchi, Iran’s top negotiator, said on Wednesday that all sides of negotiations have shown their seriousness clearly. Mr Araghchi went on to say that the team representing the signatories to the deal are eager to arrive at a conclusion during the fifth round of talks, which is said to be the final. Although he didn’t mince hi

Oil markets are stable despite the mixed signals over 2015 Iranian nuclear deal

  The volatility in the crude oil markets, which we saw in the aftermath of President Hassan Rouhani’s public disclosure that the sanctions against Iran would be lifted, has since subsided; the prices of crude oil are in equilibrium with relatively mild fluctuations. Since the politics in the Middle East is inextricably linked to the price of the commodity, analysts always keenly watch the unpredictable political developments to gauge the evolving mood; it’s something even the best Machine Learning process developed for sentiment analysis cannot accurately predict. At present, the talks that go in Vienna, Austria, in order to revive the JCPOA, Joint Comprehensive Plan of Action, also known as 2015 Iran nuclear deal, blow hot and cold over about hopes of an amicable agreement. As the signatories start the fifth round of talks today, which both sides say to be the final, analysts hope an agreement will be reached at the end; the probability of success is fairly high, despite the ul

Oil Price: the CEO of Baker Hughes expresses cautious optimism while Iranians wait for the light end of the tunnel

  A member of a powerful parliament committee in Iran, a cleric, according to the Iranian media, has said whatever agreed upon in Vienna, must be approved by the Iranian parliament – in the end.     It echoes the concerns of the moderates in the Iranian administration about the delicate balance that the negotiation team has to strike while participating in the ongoing talks in the Austrian capital. Since the Iranian presidential elections are scheduled for June, the negotiating team, handpicked by the administration of President Hassan Rouhani, has not got much time left on their hands. The views expressed by the influential cleric on the eve of the next round of talks between Iran and the signatories to the JCPOA, 2015 Iran nuclear deal, is certainly going cast a shadow over the final outcome. That, however, does not mean a final deal cannot be struck, as both sides want a clear path ahead devoid of confrontation in cold-war calibre. Iranian oil sector has been hoping for the

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