20 Episode results for "Opec"
11 AM MARKET MINUTE
"This is market minute by yahoo finance. I mean s for ray. The markets are relatively flat right now as investors have treasury yields in mind some choppy trading has been taking place yesterday. The nasdaq was down. One and two and a half percent right. now it's flat. The p five hundred is slightly higher. The dow had been more than one hundred points earlier. This morning it's now up more than fifty points. Meanwhile crude oil is jumping with wti. Up around five percent today brent crude also up more than four and a half percent a huge move in crude oil after opec plus decided not to increase output for the month of april sending oil prices higher tanger factory outlet seeing a fifty two week high. This is a retail real estate company. Would out door malls. The stock really got hammered during the early months of the pandemic is some of its tenants. Went bankrupt and malls were closed. Fourth quarter results. Low came in better than expected last month in traffic has recovered its malls or outdoor so people feel safer than in the enclosed malls restock. Though is heavily shorted in. Its recently gained the attention of wall street bats year to date. The stock is up more than eighty percent. Data opened up more than sixteen percent higher. Though it's pared back some of those games yesterday the stock was up when the nine percent for more marketing news to yahoo finance dot com.
Nigerias Oil Revenue to Drop by N140bn Due OPEC Cut
"You're listening to the news are on Africa. Business Radio. The revenue. To the federal government from the sale of crude oil is estimated to drop by accumulated some of about one hundred and forty, billion larrain, May and June this year, following oil production costs by the Nation of Petroleum Exporting Countries and its allies, OPEC and his allies. A group called OPEC Plaza cited in April oil out boots by a record nine point seven million barrels per day to shore up our prices after the crash massively following the widespread lockdown measures targeted at halts in Kobe nineteenth spread. The Minister of state from showing system. Praise Silva. Who confirmed the reduction that was done in May? Further stay to the country would continue to comply with the agreement of OPEC plus. Other. One hundred seventy nine meets in of the OPEC conference on Saturday. The secretary-general OPEC Muhammad backing the explained that voluntary production adjustment of nine point seven million barrels per day would be in May and June, twenty twenty, and that was the news this time when Africa Business Radio you can't continue to this in life online at www dot Africa business, radio, DOT, com, or find a mobile APP. Thank you for listening.
OPEC-Plus contemplate cutting global supply
"You're listening to the news on Africa. Business Radio on the hour. The OPEC plus all exports group is the Bates in cotton global supply by ten million barrels per day as I cuts must include produces from outside the alliance. This is according to an open source that spoke to writers on the matter. The sauce adds that OPEC is watching the outcome of a meets between US Preston. Donald Trump and all companies late on Friday and a final figure on costs depends on participation by all our producers. Us PRESTON DONALD TRUMP ON THURSDAY. Set he had brokered a deal. That's could result in Russia and Saudi Arabia caused an boots by ten million to fifteen million barrels per day represent in between sent to fifteen percent of global supply. President Trump said. He made no offer to cost. Us output and that was the news that design on Africa Business Radio. You can continue to listen live online at. Www Dot Africa business radio DOT COM OFFER MOBILE APP. Thank you for listening.
Oil Rises To $38 As OPEC+ Discusses Production Cut Extension
"You're listening to the news at this time when Africa Business Radio. Station of Petroleum Exporting Countries and its allies led by Russia a moving closer to a compromise on extending current oil output concerts and are discussing the proposals role oversupply curbs for one to two months. The international oil price benchmark Brent screwed stood at thirty eight point five one dollars per barrel as of nine thirty PM, manager and time on Monday. OPEC and its allies a group called OPEC plus decided in April two outputs by a record, nine point, seven million barrels per day, or about ten percents of global output, so leaves fries spotted by demand, DRP linked to lockdown measures aimed at stopping the spread of the coronavirus. Reuters quoted sources as saying that rather than easing output cuts in July. The factor opaque leaders are there was leading discussions on sustaining them until the end of the year, an OPEC source said there was support for Russia's proposal for an extension of one month, but added that there are no consensus on its yet. And that was the knees at this time on Africa business reading you can continue to in life. Online at www does advocate business radio, DOT, com or mobile APP? Thank you for listening.
OPEC Daily Basket Price Stands At $14.63 Per Barrel
"You're listening to the news at this hour on Africa. Business Radio the daily biscuits price of oil by the Organization of Petroleum. Exporting Countries stood at fourteen point six three. Us dollars a barrel early Wednesday compared with fourteen point. One nine dollars on Monday. This is according to OPEC's secretary calculations released on Wednesday. The OPEC basket is way too much of oil prices from different OPEC members around the world. And it's used us an important benchmark for crude oil prices. It's currently averages. The oil prices of thirteen countries including all Jeremiah and Gola the Republic of Congo Equatorial Guinea the Bon Iran Iraq and Kuwait other countries Libya Nigeria Saudi Arabia the United Arab Emirates and Venezuela and. That was the news. At this time. On Africa Business Radio you can continue to this in life online at. Www Dot Africa business radio DOT COM or via a mobile APP. Thank you for listening.
Oil falls to $32 as OPEC+ postpones meeting
"Faye international oil benchmark Brent crude fell on Monday after Saudi Arabian worshippers. Poonam meets to discuss outskirts called. That's could help to reduce global oversupply as a current virus. Pan-demic demand Brent's against each non-jewish could all is price dropped by one point. Two one dollars thirty two point nine zero dollars per barrel as seven fifteen pm. Niger in time Monday. The other countries and his allies a group known as OPEC loss was shuttled to meet on Monday to discuss in production but the meeting was moved to Thursday. Bnp Paribas analyst Hari Kill Garren was quoted by rights. Is he knows it that the initial appointment at the delay has driven down prices nation business and that was the news business radio you can continue citizen life online at www does Africa business radio DOT COM OVA MOBILE APP. Thank you for listening.
Monitor Show 22:00 02-05-2021 22:00
"He order breakfast at mcdonald's drive-thru tell yourself you'll wait to eat at work but it smells way too good so you eat it right there in mcdonald's parking lot neil. There's a meal for every morning at mcdonald's right now get any size. Iced coffee for ninety nine cents until eleven. Am and pair it with your favorite breakfast or one of our tasty bakery treats price and participation may vary but by mcdonalds. i'm lovin it take. This is bloomberg radio now. A global news update index say are by about seven tenths of one percent. It has been all about the show. Technologies debut look at that now up one hundred and seventy two percent Its valuation jumping by about one hundred billion dollars just in the first hour of trade now evaluation about one hundred seventy billion usdallas crude also in focus up seven tenths of one percent oil set for its biggest weekly gain since october on these confidence that opec produces are committed to restraining global supplies. And we've been watching as we may mentioning a lot of string.
OPEC Goes Virtual
"Now you can buy a fraction of a stock for a fraction of a stock price on the FIDELITY MOBILE APP VISIT FIDELITY DOT com slash fractionals for more details fidelity brokerage services member NYC SIPC STOCKS TO WATCH WALL STREET BREAKFASTS. Weekend Edition Our news teams. We can preview of upcoming. Ipo's earnings reports conference presentations investor days. Fda Decisions Barons mentions and other key events that could impact stocks to set you up for the week ahead in the markets. Subscribe to this podcast on Apple. Podcast Google podcasts. Spotify stitcher good morning. Today is Sunday April Fifth and I'm your host renewable. We begin with a breakdown of the week ahead. From seeking Alpha's news team OPEC in its partners are expected to hold an emergency virtual meeting between April eighth and April ninth. In a concerted effort to stabilize markets after the meeting was pushed back from its original date of April sixth all eyes are on whether or not Saudi Arabia Russia and the US will reach an agreement to take up to fifteen million barrels of crude off the market. Heading into next week Brent crude traits currently at thirty four dollars a barrel up fourteen percent from Friday and US West Texas Intermediate stands at just over twenty eight dollars up twelve percent with oil majors. Exxonmobil Chevron Total EP and Royal Dutch. Shell all looking for positive developments to help start a recovery. No great surprise but jobs are going to be a major focus again next week after over. Six million jobless claims came in J. P. Morgan forecast another seven million. Unemployment claims will be coming down next week and some estimates even higher other economic reports of note include the Jolt Update and a check on consumer prices while the FOMC. We'll drop the minutes from it's latest meeting to the delight of fed-watchers in earnings news is a small group. But simply good foods reports on the sixth greenbrier Revlon Levi Strauss and Lindsey report on the seven price smart on the eighth and Delta Airlines shock medications and W forty report on April ninth in. Ipo News no hence company going public next week but IPO share lockups expire unbiased HP financial and Vir biotechnology analysts can also start covering Amara. The biotech stock closed at over fifteen dollars on Friday after the IPO. Was priced at sixty dollars per share in Emma News. The tender offer on the forty seven Gilead Sciences deal expires April. Sixth shareholders vote on the Annex. Ter- International West go international merger on April eighth and look for more indications that the CAESARS entertainment Eldorado resort steel and Delphi Technologies Warner combination. We'll make it to the finish line. Traffic at Costco stores has finally tailed off. Just a bit. Amid social distancing efforts the retailers report on March sales has the potential to be quite the head-turner as a reminder costco so US comparable sales soared twelve percent in February as the consumer stockpiling trend. I started to take off and the consensus mark for COSCO'S Q. Two comparable sales. Us candidate and international. Is that a healthy nine point. Three Percent Buckle Kato Price. Smart are also in line to issue monthly sales reports airline. Traffic reports will start arriving next week could include some color on the devastating impact of the pandemic unload factors earnings and the government aid late on Friday jet blue warned of a crash. Crunch Delta Airlines said it's burning through sixty million a day and United Airlines. Set the high water for distress by disclosing that. It's losing one hundred million a day. It's likely to be another week of volatile trading for airline carriers the car on April seven through the eighth has switched to an online format due to the pandemic the All star roster of speakers includes executives from mercedes-benz. Google iheartmedia Lincoln Ford an Intel. The expected timeline and uses for five G. Bay cellular connectivity into cars could be an interesting topic. The restaurant industry will be put to the test again next week. As operators continue to look for takeout and delivery work arounds to keep at least some revenue coming in analysts expected industry could look different on the other side of the pandemic. Cowan's Andrew Charles Sees Domino's pizza and Papa. John's international nabbing market share from independence and value minded chains like Red Robin Gourmet Burgers. An Olive Garden resonating in a harsh economy. The pivot for chains focused in dense. Urban areas isn't quite so simple. Shake shack isn't standing still already adding ubereats endured ashes. Delivery options and partnering on Cook at Home Burger Cats. The list of short favorites is worth taking a look at him. In the wild market swings while Blue Apron Peleton interactive has defied the market collapse as favourite. Stay at home stock picks. There are plenty of short picks cooperating looking ahead to next week. The list of HIGH SHORT INTEREST NAMES INCLUDES GAME. Stop match group Gogo Mellon Crowd Smile. Direct Club Tanger Factory Outlet Car Vanna. Amc ENTERTAINMENT DILLARD's stitch fix and wayfair and a pure dollar basis tesla is also near the topless with short interest standing at over a billion. Then in what would have been a shocking development. A few months ago short interest on Nike starbucks Home Depot has moved much higher than historic norms. Analysts seemed to be in disagreement over whether the closing of many retail stores will be offset by the boost in digital sales amid the pandemic and the positive side. There's also been an increase in twitch viewership and steam users to go along with explosive sales of Nintendo's animal crossing however that burst of energy comes against a long street of monthly declines in video game sales ahead of the console refresh cycle the next test of the market could activision Blizzard's release of call of duty modern warfare season three on April eighth the shock of the massive amount of furloughing of US employees will wear off a little bit next week to leave the question of what it means for. Investors analysts say the crisis management skills of top executives and the strength of the underlying businesses will be critical factors in seen share prices. Recover a partial list of companies that instituted furloughs includes macy's Kohl's JC Penney L. Brands Children's Place Ross Stores Urban Outfitters Marietta International Steve Madden Lazy Boy. Ethan Allen Casper Sleep cheesecake factory. Five below shake shack CAESARS. Entertainment Fusco American Eagle outfitters and Marine Max. And this week in barons mentioned the stocks and the themes drawing attention in Barron's weekly addition the tough stretch ahead for the advertising industry profiled in detail with spending expected to be down sharply on the digital side. Facebook and twitter have already warned that they will take a hit from the downturn while Alphabets. Google is also likely to be hurt cable players like AMC networks Viacom CBS and discovery phase advertising dollars drying up as well as subscription services growth as well as a lack of sports programming in a triple whammy that could set the stage for an acceleration in the long running cord. Cutting trend sharp revenue drops are also expected for New York Times newscorp Meredith Gannett clear channel outdoor holdings out Front Media Iheartmedia and Cumulus media the largest. Us media businesses are seen as being a bit better off but trouble areas are still on the road ahead for comcast. At and T. and Disney the publication also sets out a list of biotechs to own for a post pandemic world that includes Gilead Sciences. Blueprint medicines who he biologics. Wou HE APP. Tech Invitation Bluebird Bio Therapeutics and Crisper Therapeutics as we do every we on this week sox to watch with our single stock focus and this week. We're taking a look at that. Beaten Down Stock Carnival Corporation Harry Ren took a look at the stock on Friday just before it closed the week at just under nine dollars. Harry ran who is bullish on the stock believes that the company won't go bankrupt. He begins his thesis. Thusly Carnival Corporation recently conducted a debt rates of five point. Seven five billion and an equity offering a five hundred million common stock priced at eight dollars a share to help alleviate liquidity pressure the company has cut its dividends and stopped all share repurchase programs for the foreseeable future which was expected. I believe the Carnival Corporation has many options to choose from regarding managing this new debt and as a result can stay afloat to reach evaluation. That more correctly reflects this cruise b. m. off twenty six dollars over the next two years ran then goes on to discuss. Why Carnival can service the debt doing some quick back of the Napkin? Math carnival originally had about eight billion in long-term debt. Do by twenty twenty three. This is on top of the newly issued five point seven five billion of notes and credit facility draw of three billion which can be extended to two thousand twenty six in total. That's roughly thirteen point. Seven five billion of debt do by twenty twenty three an important thing to note. Is that the original. Eight billion of debt is split up into four years at a little over two billion a year. Carnival needs to use its freshly raised funds. The most for the time period when it ships aren't an operation and it isn't generating internal cash assuming all of twenty twenty until two thousand twenty one. Where will get that? Cash brand answers internally. Carnival generates approximately four hundred million in cash every quarter. I expect this number to increase to eight hundred. After thirty percent cut in Capex from building new ships and stopping all share repurchase and dividend payouts. So we will see benefits from cuts. In dividends and share repurchase immediately the full forecast at eight hundred will start in twenty one and onward until cash flow from financing. An CAPEX can return to normal. Externally Carnival has received six point five billion from external investors via debt and equity issuance. The offering was oversubscribed which allowed the company to decrease interest rates to twelve from twelve point five percent. Originally we should note. These bonds are junk yield levels that have carnivals assets and vessels as collateral which makes for an attractive opportunity for bond investors also. Three billion was made available from the company. Credit Facility Carnival will use the credit facility debt issuance to cover any immediate debt. Do before twenty twenty one rent goes on to discuss the bailout. Carnival has other options not taken yet. That show us. There isn't a need for last resort measures at this time the trump administration has hinted at a previous corona virus briefing that if these cruise companies came back and register in the US it would be easier to grant them loans. Carnival has the option to do that but not yet taken steps in that direction nor has the company publicly voiced plans to do so and in conclusion ren ends here while much of the panic and selloff is justified for now. Carnival Corporation investors are pricing in a situation that takes bankruptcy and liquidation into account. According to my analysis the company will be able to service this debt until the twenty twenty three due date after which conditions have returned to normal for two years and a vaccine is most likely developed. The stock trades at prices significantly lower than both its assets and with the company is worth as a whole when afloat. This is a long term. Hold for at least two years as this thesis unfold and Carnival set sail to normal valuation again overall seeking Alpha contributors skew bullish on the stock with two very bullish six bullish four neutral and to bearish. That concludes this week. Stocks to watch. Thanks so much for listening. For the best investment analysis and news on the web go to seeking Alpha dot com. Subscribe to this podcast. An apple podcast. Google podcast spotify stitcher. You can sign up for other podcasts. Behind THE IDEA. Alpha traitor essay for f.a.s.t let's talk. Et APPs cannabis investing podcast and marketplace roundtable and those platforms. As well have a great week. Now you can buy a fraction of a stock for a fraction of a stock price on the FIDELITY MOBILE APP VISIT FIDELITY DOT com slash fractionals for more details fidelity brokerage services member NYC SIPC.
Angola Agrees To Comply Fully With Oil Cuts After OPEC Pressure
"You're listening to the news at this Africa Business Radio. According OPEC's falls this and has agreed with O. Beg to comply fully with a global pact on supply cubs, and we'll compensate with previous overproduction cotton more from July to September, the Organization of the Petroleum Exporting Countries and allies led by Russia a group known as OPEC flaws, agreed to cost oil output from May by a record nine point seven million dollars per day after the coronavirus quite destroyed of fed of global demand, the wreck of constant to run to the end tonight Bertha tapering to seven point seven million dollars per day until December. So stood white, since then on Gola had now committed to improve its compliance with this quota, and may comforts, May and June older production by cotton more in July to September. and. That was the knees that this time on Africa business. Radio you can continue to this in life online at www dot, Africa business radio DOT COM or via a mobile APP. Thank you for listening.
A Divided OPEC Meets in Vienna
"Wall Street Journal listeners. Come from all walks of life and business and no matter what type of business urine eighty P is here to help you achieve what you're working king for with. HR talent time benefits and payroll informed by data and designed for people learn more at design done eighty p dot com a divided OPEC meets in Vienna today. The Saudis have grown pretty tight of shouldering more than our share of these catch on Iran and companies are quietly fixing accounting errors all without alerting investors. What we're seeing is an increasing racing trend for companies when they discover errors rather than doing full restatements to revise? The past numbers class could more. We're American troops be sent to the Middle East. This is what's news from the Wall Street Journal on Kim Get Allston. Let's get started now before we take a closer look at OPEC's meeting and what it could mean for how much we all pay at the pump. Here's what you missed. Were reporting that the trump administration is considering considering expanding the US military presence in the Middle East. It's to counter the threat posed by Iran. US officials told us the expansion could include dozens more ships other military hardware and as many as fourteen thousand additional troops in a tweet. The Pentagon denied that troop figure officials told us that no decision in has been made and that the president could approve a smaller deployment. He's expected to make a decision as soon as this month. While way is fighting back we told you last week that the Chinese telecom giant is challenging a ruling by the Federal Communications Commission the ruling from last month blocked rural. US wireless carriers from using an eight point five billion dollar a year fund to buy equipment from Welwyn today while way officially filed its lawsuit. Here's the company's chief. The legal officer song looping at a press conference at the company's headquarters this morning when passing this decision. They've did not offer alway due process or verify the facts but they very loudly and very publicly labored. All Company is a national security threat. There's easiest older violates the constitution and we have has no choice but to seek remedy the FCC had no comment what's rounding error. We report that more. Companies are quietly lightly fixing accounting errors without reissuing financial statements like Papa. John's Gene Eagle Shem Explains Puppy Jones found an accounting arrowed. Meant it affected its years of its balance sheet and earnings but they decided that the Arrow wasn't serious enough for them to have to warn investors and restate the state that the numbers the SEC. Question them why they sought. The eras weren't so serious that they had to restate the financial statements and Investors Papa. John's gave a very long expedition detailed explanation and has accepted that gene says Papa. John's isn't alone. A growing number of companies. These are just revising pass numbers instead of restating earnings. She says it's not illegal. That's partially because the Securities and Exchange Commission doesn't have a hard and fast astral about what counts as a significant revision. The SEC does polices. What's interesting is it doesn't question that many of these companies but he's decisions so other research showed only about four percent of these the? SEC says physics by why I think the SEC one concern they have is potentially essentially if too many companies do big our statements it could sort of flood investors with information and it devalued them so also I think. SEC thinks companies mishap degree of discretion. Over this none of these sort of hard and fast rules so what when is an associate -nificant that it warrants a bigger statement that set something. That's a matter of judgment the SE and Papa. John's declined to comment Mood now our main story this morning CAPAC the oil cartel members and partners are all gathered in Vienna today for the start of a two-day meeting. It's a big moment for the past few months. It's members have cut oil production all in an effort to increase oil prices. Now the question is if the prolong those cuts or if the let them expire. Ask planned in March David. Dari is at the meeting in Vienna. So David Walk me through the backdrop of these talks. What have we seen in terms of oil prices and oil production so the backdrop of this meeting is over the past few years OPEC and its allies have been implementing oil production cuts? This time around is is An expected increase in supply in the first quarter of twenty twenty including but not limited to rising. US show production on also. They're all all fares about demand not limited to uncertain economic data in part linked to the China trade war oil prices. I would pass you. Today's have resumed on hopes. That OPEC may deepen its but they are historically speaking relatively low on one extra element of this. That meeting is that Saudi Aramco the world's most profitable company is going to be announcing a IPO price on Saudis. Best interests to support prices because in some part the success of the I I is linked to stupidity of oil prices. So who are the factions factions at this meeting the factions at this meeting four and two maybe three broad categories. You've got the Saudis and it's in their best interests to to support or prices as much as possible They've got the ARAMCO. IPO TO PROTECT On they've been over complying with The cut quotas. They agreed to pardon pretty much full. Most of the period of time. This deals being in place. You've got the Russians who are the leaders of the plus function and In OPEC plus on data really want to cut from much longer on a certain debt. Really want more deeply They are working on concessions from the rest of our plus for that content sites they just want enormous new pipeline with China on the base wants to produce as much as they can but they see the benefit in supporting our Saudi allies on the third main function is probably the under complying OPEC nations and particularly the Iraqis on the Nigerians. When when the Iraqi minister arrived in Vienna choosing night he was quite put about about the idea of Deepa cuts? Even Iraq hasn't been fully complained for most of the deal so far. So that's a little bit like saying let's let's go to a more expensive restaurant but the service can pay now. Haven't we been reporting that instead of a cut. Saudi Arabia and the run up to the meeting has been threatening to unleash even more well oil. How does that factor into these discussions? The Saudis have grown. Pretty tight of shouldering more more than that fast. Sheriff these cuts on their own and in the days before this meeting that even threatened to do away with cut soul together ramping up. Production and essentially crushing global news prices. You some of the spoken to so that would be a moral victory for the Saudis. They don't necessarily think it's option though seriously. Consider Okay so the meeting concludes tomorrow. What our market's GonNa make of all of this? There are three possible. Brewed outcomes uh-huh and for markets. At least on Friday number one would be a barish out can probably a rollover of just three months. I taking deal to June twenty twenty. I don't think that would be enough to support oil prices right now and nor does anybody else that seems a middle way option. Might be a a six month rollover with not the cuts and even then some of the people have been. You don't think that would be enough and a sort of third basket of options uh-huh either extending by twelve months or deepening cuts on the figure. Full hundred thousand barrels a day extra has been touted that would take cuts two point six million barrels a day cut. Either of those last two options would probably be taken quite well by markets. You can find Oliver reporting on the OPEC meeting as it progresses up under WSJ DOT Com Wall Street Journal listeners. Come from all walks of life and business and no matter what type of business you're in eighty P is here to help you achieve what you're working for with. HR talent time time benefits and payroll informed by data and designed for people learn more at design done eighty P dot com on to markets. We're going to focus on a particular type of stock. Today value stocks they tend to be confusingly undervalued. So you'd formerly the definition is that they trade with a low price is a multiple of their book value. Now the thing is they may be unloved for reason they could have a lot of debt for instance or be an unpopular sector but historically dave been the stocks that outperform over time in fact it's the investing strategy that helped make Warren Buffett rich rich recently. There's been a lot of debate about whether that's still true. Or if the other category growth stocks are really a better bet but the key thing we're looking at today is the relationship unshipped between value stocks and bonds. Paul Davies says. That could tell us something interesting. About how markets have changed so. What's really interesting is? He's the link over the past ten years. which has gotten much tighter recently? MP We're paying much more attention to recently the link between value stocks and what's going on in bond yields and the simple version of this is when bond yields rise particularly when longer-term bond yields rise relative to short-term yield so ten-year rises arises moving to you for example value. Stokes suddenly perform much better. Paul says there are a couple of things that could be behind. This one is that arise in the ten in your bond yield usually means. Investors are optimistic about the economy. That means that they could also think value stocks will be performing well down the line another has to do with factor investing vesting. It's when you choose stocks in a portfolio based on certain factors such as momentum or company size. It's become more popular and Paul says that may be influencing saying these changes that we've seen so you combine all of these things and the way in which people looking at markets sort of more holistically as a whole. Oh and what we're noticing is that price moves in different areas becoming very closely linked so when the cavs deepens fatty stocks on the APP perform and gross stocks underperform and vice versa. And this kind of tells us something about how crowded markets have become how trendy trendy they've become and how many people are doing very much the same sort of thing with the money which could be dangerous. And here's what else were paying attention to today. We've got a ton of companies is reporting their earnings including many names. You might recognize dollar general and Kroger report today as well as Ulta beauty will also get earnings from tiffany. The Jewelry Company is being acquired by the French luxury conglomerate. LVMH for over sixteen billion dollars that stands to be LVMH's biggest acquisition ever finally. Here's a job that sounds amazing professor to the stars Anita Alberti has built an academic career and a strong instagram following studying the conditions that create the greatest success stories in sports and entertainment at thirty eight became one of the youngest women to earn tenure at Harvard Business School now. She leads an executive course where grammy winners and. MVP's think Carly Kloss. dwayne Wade learn how to put their skills to use in the business. Ns world she says the biggest thing that the stars who take her course tell her is that they wish executives would see them more like human beings. Were curious which success story Roy whether it be a music album famous ad campaign and unstoppable winning sports team. Would you like to learn more about you can tweet us at WSJ podcasts or email us At what's news all one word at Wsj.com your comments might be used in follow up reporting. That's what's news from the Wall Street Journal. Thanks for listening DOC.
Daily Brief - An in-depth look at the global oil and gas industry post-OPEC+
"Welcome to the daily brief the world. Oil podcast network daily review of market news emerging trends new technologies and the people who are advancing the oil and gas industry. Here's Cameron Wallace with your top news. Stories of the day afternoon and welcome to the world. Oil Daily brief podcast. I'm Cameron Wallace and today is Friday April the tenth. And as I've been promising all week we are joined by Mr Simon. Watkins analysts investor and author in the United Kingdom and. I'm really excited to have him on the show today to talk about all of the activities that we have seen in the past twenty four hours eight minutes past twenty minutes or so so Mr Watkins. Thanks for joining shorter High Cameron. Thanks for having me back through with a with a play yet I mean things are moving apace. Certainly are in fact. I think it was going to be a different very different conversation just up until about half an hour ago we had learned yesterday. Obviously that Russia and Saudi Arabia decided to bear the hatchet as we see over here Well Russia certainly not see I in some policy Saudi Arabia's national me that's show as historically speaking I mean the fact is if we look at this in broad terms to kick off with and then we can Let me dissect. It's you know we have. We had a situation. That's just that's just go back to where we were in December when we were looking at pre the oil price war so we were looking at a fairly balanced ish markets We were coming up to you. Know and you Opec process agreement. Virtually being ready go Which will keep our balanced. The balanced pricewise was essentially between fifty five zero doors. Power of brands and seventy seven zero Dollars per barrel of Brent with the emphasis really bring on the sort of fifty five to sixty five area and the emphasis even within not being on the low side so that was where we were then obviously Saudi Arabia to drown to Russia. And and essentially we're trying to hijack loam into doing bigger carbs fine have been privately agree between Saudi and Russia and Russia which is not lean does not being threatened by anybody very well at least of all the Saudis for whom I have complete contempt and So they turn around and say well no you do whatever you like and thinking I mean. Presumably dreaming for the Saudis. Wouldn't be enough to do exactly what failed law threatening twenty four tate sixty in but behold. That's exactly what they did forgetting. Seemingly that they have a Brent break even price the Saudis issues of eighty dollars a barrel whereas Russia has forty dollars a barrel Budget break even price and your show producers could manage forty as well for the most part the good produces so that is where we were. Just why we all now? The that was predicated that Barnes was predicated essentially on the global demand of around a hundred million dollars a day as we know which was tight what was coming onto the market was cheating going on with the the OPEC plus steel lost. Aw as but that's that was where the Balance Wall so against that we've had corona virus reduce Demand globally boy around will the estimates are anywhere between twenty five and thirty five percent so obviously even the Saudis were twenty five million barrels a day to thirty five many hours but in response they've caught Tan between them which is ten percent. I'm saying this for the Saudis benefit Broadway camera. No no no you can work this out but ten million dollars ten percents all of the bond as walls and the demand has gone down thirty percent so even if as well as expected. Let's say The other Tangential produces coming in. Add another five million barrels. Perhaps at some point to the carts then you're still looking at fifteen percents The problem is without i. It's nowhere near say to me point of first percent. So it's nowhere near the answers you know. I thought I was GONNA say and also without cheating normally goes on with it and the fact that these much more long drawn out process in the fact that the you know the starting points the baseline of very high. They always all when these things are done and things got more housing than a good Swiss cheese. I'm wondering where that Ten million barrels a day figure came up. Because I know that you know it does from my observation days before the started. Ihs market put out a research report as well you know based upon what we see with you know demand decline in the US particular The market would need to shed ten million barrels a day in production in order to achieve some sort of stability and that number came out and the low behold the next day trump tweeted ten million barrels a day. Did he plugs into that number? Get plucked out of the air to be a fascinating tale behind that specific figure. And I'm sure you're gonNa tell me what it is. Well I mean I can't really I can't definitively throw light on that. I mean I can only go along in the same river Road is you. Which is there was this figure. But this figure this is from you see. I can only shoot the this figure of Ten to fifteen percent right cart would be good enough to rebalance the market but the point is that this figure was taken from the very beginning of the of the onset of the spread of Corona virus outside China. This was the figure that was in January. This was the figure this was the figure. Because if you remember the original figure the the the the Saudis. Let's go back to the the the way we were the previous. Opec plus call. That was going to be just based this was if you remember the beginning of January because they would choose to to announce a new one so at that point remember. The beginning of January corona virus had only affected China so not a certain areas of China and was beginning to spread into other areas of Asia particularly South Korea of course So it was extremely limited that point and at that point. Saudi was saying well look. Let's Josh cards you know. Say a million barrels per day. Maybe even one point five now. This was before any of this really. The Corona virus really saw it to get to gain momentum and so within not first month of January of this year when it was beginning to spread but nobody had any real consecutive of how contagious it would be on the fake walls. Well hang on. We are losing this amount of armed throw principally from Jibril's s some some key Asian refiners so actually ten to fifteen million ten to fifteen percent should be the toll that was January's figure so I can only assume you that this is the figure that people who've been using because as we all know Anybody who knows anything about what's wrong figure now as well as I say. Anywhere between twenty five thirty five million barrels per day bright now depending on the absent flows market supply and demand so meet point thirty so I my only possible guests on this and that is a gas or just drudge. Now is that it's it's a hangover figure from from late January Because he's not real as you not with nowhere near true that's been the most fascinating thing but all of this and we'll get into a later. I'm sure but you know. Just throwing around of production figures and commitments. What am I? Don't know what the American education system is. One of those educate is one of those in the British education system. When you about twelve and agenda here gender afford US clever. They sought to throw mice questions. I you know I if a train his going at twenty five miles an hour. I'm fifty five passengers on board. It stops altering them. Three passengers get off to own. And then it goes. How far is it going but you know I have no idea? It's really just so many. There's so many variables all of this and this literally. I mean the best. They are guesstimates to degree. When you get to try and precisely now dow but a fat estimates Of the production of the DEMAIM DECLINE. I would say is thirty million by digest based on propriety stuff that I've had to look at and Refinery runs and locking and Lockdowns CHEFS INS. And and all the rest. I think that's a fair fair but even if you even the most moderate of estimates he's twenty five and certainly not Tan. I mean as attentive days. Now any other will. We're racing towards a higher. Figure ourselves here in the states. I know that over the Permian Basin and the Shielfield. Sister having to lay down rigs and shut in production. Because there's no place to put the stuff anymore Even the pipelines are full so What through rates. That's another thing I mean. This is a very good point. You raise which is the even after You know it's very well saying that You know you're GONNA Cup. You know you. You're going to cut production and so on but a lot of his production actually is just GonNa be anyway how it is already being caught by into the fight going. No there's nowhere to go. If the oil has nowhere to go I mean the the. Us is pretty much full. China's full all of the Begum the SPO's they will they will full and Floating storage is nearing capacity the the CC rights or shipping rights through the roof. So you know what I'm trying to say is there is a dividing line between what you're cutting buy into wanting to affect the the demand supply matrix in fact the prize but also as it there's an actual Results of Of just you not being able to send you do that. Well and I think that that is what is causing some consternation. Is that over to round off my point. So it's not real. It's not a real production carthy. It's just it's just a vagary of supply and demand. There is some real action in the cart in this. But it's nowhere near what some you know. What the diminution into Monday's saw you you're gonNA say anywhere not real. It's not real and it is interesting to see how opinions vary on what that means because I know that The Saudis and the Russians are a bit irritated. That trump seems to think that he can just rely on these market factors in that associated production decline to count for Proactive production declines on. Their part is a very good way of putting on because and they're not and they're not satisfied that obviously and understandably so but there's another factor here in the US too where A number of typically the smaller Shale layers and smaller producers are interested in a probation scheme whereby they artificially or you know proactively limit the amount of production. That happens in some of these places so that you know we would indeed have some regulated decline in production and the you know there are two different camps on this players are for it and the bigger companies are dead set against it which is which is Bruce up some interesting conflict over here but it is interesting not so. That's a very interesting point. Seems to be lost on The Century People don't seem to understand that the the the US Secca is Is well dominated. I mean I think ninety percent of nine zero percent of Of all of the total number of shale players in the US already you know they know exactly more empowered. Bryson's an far off you know they've thought that they produce a member of the top of my head I think You know their incomes five million dollars a year or something. I've got you know. It's very small that accessible figuring they just got a handful of people who are who are He will working on that particular site and There was a guy I think. It's bizarre bizarre over there but It's what it is. I mean I see the guy. was his name. Ryan Fitter. I think yes Yeah he he's. He's in charge of the railroad the Texas Railroad Commission or something. Remember that quaint. And you think anything Shane. Apparently it has yeah. So anyway as you say he was treating. Crc TO I called him manageable. The Saudis Russia's to this. But anyway he was. We've got a call on the line from the Texas Railroad Commission War Water. You talking about how down in Moscow but anyway so he was pledging anyway on a power on on on sort of apropos. What you said on behalf of a group of of the of the shower juices that they would be a cost of I think he's saying a one point about five and five hundred thousand dollars a day something like that. I think he told her. No DOTS and Does not to be sneezed up. Then I think as well that there were other. Tlc members said well actually no is not. There's no There's no consensus for this at all and I think as well Quite shortly afterwards some of the bigger players in the show sector you know Came in and said well we we not cutting production tool so I mean the and and also of course They have a problem there with anti trust. Laws the You know you precisely water. Trump's been threatening the salaries with for some time You know an OPEC with which is You know actually monopoly laws. So you can't really. There's a very small as far as generally very small players All of whom is working for themselves and And also there's no consensus there and on the other side of things the antitrust laws which means that some you know they. They can't really act in any way as a monopoly. Trust as you guys say yeah. Yeah yeah the whole Ryan. Sit thing was interesting because he's been doing some interesting research on what will happen with demand and how long it'll take to return following these. Ron Virus Issues and shut down. But you know Mr Sitton is on the commission but he is not the commissioner is one of three and he is going to be there for humour months. He failed in his shoulder. Actually ask the weekend the only yeah to your to your point I can imagine. It was a humorous Mr Novak's handler. Got Him on the phone and said I want to speak with you out for four months. And in fact he's not really that much part of him with what he wants to offer you so yeah he a pledge five hundred thousand barrels a day caught. So what do you reckon? 'cause it probably was about April the first you may have thought it was an April fools joke because the Russians do of a sense of humor is very underestimate and if they do have one it's is one of subtlety in of nuance and threatening his position nonetheless but no so I mean coming onto this. We are I mean some coming back to the original points We have a a heath discrepancy between the Domon short for the humiliation demand and even even on the basis that everybody is to their Their quotas You're talking about a twenty million dollars a day. in excess supply Well I mean it doesn't take a genius to work out what's GONNA happen to the oil price then. I haven't been in this long enough to really be able to picture what happens one. There's literally no place to put it anymore. I mean I can imagine recent really. I mean. Nobody's really been in. This position actually gives the market tends to balance itself and But the thing is that there's never wore for years really ever since the the rise of China which was soon a long time ago really talking over twenty years when it starts really feel love. You never have thought lack of demand. Now Chinese tamales coming back when he's coming back in patches and You know manufacturing and industry they should be back to normal relatively speaking You know by well certainly by the end of this month or even the quarantine in wine. Which was the epicenter of it. Nope that's being lifted lifted yesterday the day before. So there is there is demand coming back with US going to take alongside field through. And that's just China because You know the rest of Asia remains corona virus bound. They've dealt with it quite well because it's a long history of dealing with these sorts of things solve them and so forth So they got on top of it very quickly but some you know the. Us IS A are big consumers. Of course people tend to forget those massive consumer of oil. And that's You're you're talking about Quite long time with weeks really before you get to the peak Same is in some parts of your pool though Italy and Spain Who will have of course oil consumers they They are probably nearing the peak now but I mean talking weeks really and Lobby for me to throw spanner in the works but Their vaccines Looks like being effective accent. Looks like being at least a year. Away You know who's to say either. We don't get another. Everybody unlocks down. Whatever the opposite of lockdown is whenever anybody. We do that. Who's to say there's not going to be another outbreak? Yeah and he said cheerfully. This is invited to so many dinner parties one of the many reasons. Talk about films or books through things although I do sometimes throw away my My gas and Oil Per barrel linear equations and history of US presidencies elections oil prices. So you know my social diaries. Frankly just it's a desert to be well when your conversation before when you need a Whiteboard to advance your dinner party conversations from time to today but anyway you'll next question. So yesterday we had Russia and Site Arabia decides to on a cut. The no the terms are still bit foggy. I I suppose about the point is they did agree to do something everything. Sailing along night of all people Mexico said they didn't think that it was a great great scheme and then the wheels fell off Look Yeah but Mexico's role was before we get into what happened next. How could that have done first? Place puzzled me. Well Matt you see As it stands right now to the best of my knowledge on this changing situation so essentially. What's happened is this. Which is this basic deal first with Mexico Adam and then we can move onto if you like how it really is just ridiculous because but yeah well I mean okay so really. So this is actually. What's really great which is essentially Russia and Saudi Arabia Wichita In order now the number two and then number three oil producer in world after the. Us which is now wants the US producers well scoring thirteen million barrels a day Russia about we'd have an off call it twelve and Saudi Arabia realistically ten while they pretend it's twelve but is so. That's that's where we also Russia and Saudi Arabia agreed to cuts between them ostensibly even so two and a half million dollars a day. Age is apparently while they agreed. So it's five million outing together so other OPEC which uses were to all in five to to remove another Five million bows and these. Are you know people like us? Canada and the US which that was a completely different story for the reasons outlined but fath- mish old but also Mexico. Of course he's warm because a whole the whole a burgeoning oil industry. I'm very rich failed so any white. Mexico was due to caught Well they were asked to Kutchi not cut four hundred thousand of barrels a day And the and and then I was taught in Mexico. A three part turned around and said well. We don't want to do that because Actually we had only planned at a maximum on doing a hundred thousand absolute maximum because we need revenues to you know for the for the the The the economy for economic for economic measures have already been planned laid out in the budget. So that is what? That's what happened there then. Apparently They they have as we speak now. They have been persuaded to increase finally modified by trump saying that the US might actually be able to Help we say two hundred fifty thousand dollars a day although frankly where are they going to get that? From given the fact that they're all the anti-trust measures against the The Shale Producers. And there's a complete lack of consensus with us. Shell Jay says. Frankly anybody's guess. So that is where we. That's where we are. Yeah well and that goes back to what we were saying a little earlier about you know. What do you consider a cut to be a proactive cut? Which you tell people to stop or is this well the not gonNA produce it anyway so good and put that on my tab a thing. Yeah exactly wing. What's what's two hundred fifty thousand barrels among friends? Yes walk as that. I mean she really thought just. That's just not true. People are not going to produce anyway. Because it's so big. It's not just it's just not worth it so so. Yeah the Energy Secretary of Mexico said That's No they needed to keep to the production spending plans so they've been pursuing Despite despite that yeah yeah and and their plans were exceptionally aggressive. Before any of this and then they decided to expand their drilling program for this year. thing that said they're gonNA try to add as many as four hundred plus new wells this year really. I didn't know that figure but it doesn't surprise me because I have a very aggressive singer. Yeah they do. And unfortunately there The aggressiveness of the strategy is not on par. With the success of the execution they had A good number of programs. They're trying to use local in indigenous companies to Mexico. You're twenty two new drilling programs at the second. Half of last year ended up having to rebuild almost all of them to foreign companies because they just weren't getting done Schnur that There's a bit a bit of puckering going on over there as we say. Well yeah I mean so. It's what goes around comes around is now sure I they they they. They haven't forgotten the trump war. I don't it's not not way to win friends and influence of support but on this will go on. I do want to give them credit because every year they do some very aggressive. Hedging the yeah. Well it's the the the town. Yeah that's why they call it over here the Hacienda. It's fantastic. Yeah well screw thing to do. No absolutely and they they Well this year's absolutely paid off. This is be honest but I'm ready to this camera. Right into this This deal you've got to remind not only I mean you will remember you do remember the the fact that there is rampant cheating on on these quotas. Anyway I mean Iraq never takes any notice. Iran's nor in the anyway is is not included. Libya now included Nigeria does what he wants Ecuador. Of course I can't even remember whether officially no out now days but whatever is I never took getting ours. Anyway and Russia's he got what he wants so it generally fall to the Saudis two Two cards but then they're lying anyway because the amount and then to be cussing from they've never produced in their lives so it's all just as I was saying is angels on the head of a pin is just fantasy fantasy land really but anyway having said that despite this this a bizarre fantasy world that is is this. Dale even within that. There's more which I don't know if you've heard this but this is this is true as well. Which is the the ten million dollar day cards may shrink? This is in the Dayo? Incidently may shrink to walk. I know it sounds like a few drinks. Perhaps making up a really isn't I haven't been out to the public tool for a long time will tell you that dances the lockdown. But so this this is actually true. The ten million dollars a day cards may shrink eight million barrels a day from July and then six million barrels a day from January two eight four from January. Twenty one eight twenty two. This is according to the OPEC statement with the actual deal in it and that depends on how people think the deals going to say yeah. They meeting all of viral video conference on June. The chance to discuss how the deals going And they may then cut it to two ten to two eight. Well I suppose in their defense would expect such a thing. We written in there that way this very much. A temporal sort of a project working on and maybe that's g twenty is getting together tomorrow to to go into politics. Cameron bigly definitely you. You're very diplomatic person. That's one way of putting it. Yes almost twenty years. That's about saying you were very very well. Bought up young boy. I'm sure mother be very proud now. But back to these as well. These baseline levels. Incidentally they're crazy is of course because the Russia's GonNa have reduction applied From the baseline level of around eleven million barrels. A day which is exactly I mean Russia vast exactly what their previous essentially that baseline level wars for the previous Carson. Nothing's changed at all and they'll still produce eleven in half anyway absolutely no difference whatsoever. Saudi Arabia you know what they do of course normally when they're setting bent Ah benchmark Bait Baseline level is that Saudi Arabia ramps up production so that can just cut back without actually doing anything. It's base it's production baseline seriously. It's eleven million barrels a day. Well as I pointed out lawful which seems to escape the nose. Most people do seem to regard. Saudi is an oil powerhouse which it is to a degree. We're nowhere near what he thinks is nowhere nowhere near what anybody else. It is is the average amount per day. The Saudi Arabia has produced every day on average since one thousand nine hundred. Seventy three to the beginning of this year is eight point. One five million barrels. It's nowhere near so the point is he's production by slice of nonsense will they? Weren't they amusing getting to the eleven number by counting dumping there Yeah Yeah Yeah. Yeah no way your guy without interrupting. Yeah no infantry. Surprise really haven't going nuts destroyed factored in there destroy. How smart I am well. We're not that snow ridiculous so that so that's that's nonsense as well. Basically they're just going to. This is when I say this is if you take all of this nonsense right. So we've got a a a theoretical figure of ten million barrels a day. If you take this out even vesa site stick with the tank because that's what it is currently if you take out if you check out all this nonsense which you know. Unrealistic never seen production levels the baselines. Are you really and what they were gonNA call anyway because of the technical factors you'll probably looking really six or seven million barrel per day cards at most because it's not none of it's true if there's no point in saying I'm GonNa cut from twelve to ten when you've never never had twelve anyway. You can't count as part of a cost because you've never done it. It's a bit like when women say I'm going to save you. A thousand pounds stalling you go. Oh that's good yes. This dress is on sale for five hundred dollars. That saved you sa- say because it was on sale for thousand five hundred so I've saved thousands. Go no you really haven't. I'm not gonNA go anywhere near the out false false. It's IT'S NOT REAL. You can't say cart is from something that you've never or you've done for like ten minutes you you know for once in your life you can't say that's the that's the level and we're gonNA cut from that we're GONNA cut two million from that because it's not a card. Yeah Yeah that's what I say. Absolutely don't look at it is. It's all just storytime it is that Simon why we've seen the oil price actually go down since since the the plan with announcing go down even further after they ever. Mexico said that they will go ahead and comply. Yeah always setting in. Is that what's going on? I mean there are two reasons technical and one's fundamental technical reasons as the CIA. He'd markets as always a There's a saying as you know by the rumor. Sell the facts. So the rumor wars they'd be caught So people buy that on that basis. Then there is a car so they sat on that prices but vast technical reasons sway mortgage work. But the second reason fundamentally is people have you know people are not you know people are not idiots in this in this business and they look at the details and they look at the details in you know infinitesimal. Infinitesimal Gile If you will and you people I've come to the conclusion right lay in my opinion that it's it's just full of holes and it's It's dead on arrival really technically speaking as well Won't I mean I mean the day was basically done the the daily five outline the dawn? There's not really going to be anything tonight as far as I can see. So you're looking at this level of inverted commas carts and so really. There is no reason. Why brench shouldn't go down too twenty again if not lower and why WTI you know. That's a huge premium with them. I went between brands and Wti like the old days seven or eight dollars. But I mean really speaking. You know. There's no reason why. Wti shouldn't track down towards the fifteen told about every if not lower before demand really starts to kick in. But you've got to bear in mind what I was saying about Chinese demand coming in. That's true Asian demand will lag slightly. But we'll also. Roy is but the point is is concomitant with a massive overhaul of stock in in storage. Yeah so you see what I'm saying is you've got weeks and weeks of storage now. Well many many weeks facts even before. So that's going to be Taken out of the system before you know before any of these cuts can be whatever comas cards could be factored in. That's the incredible thing in all. This is even a period short as a week. Means is the meaning so plastic now it. Could you know only matter of weeks until the you know? Demand goes back up from. We're awful lockdown. Oh let's one meeting of a week conversely you know we've only got two weeks left until there's no place left to put oil. Yeah I mean basically if the only I mean really speaking as a world stop producing oil today and you you would probably only see Brent go up to fifty in about a September assuming production from now from the Second. Yeah because so much if I go ahead no I was just going to say. It's amazing because you know as you were talking about by the rumor and sell the fact. We're all looking forward to this. This big announcement came and my goodness provide website. Traffic didn't go through the roof. But that was like okay but there. But there's really nothing else after this you know. There's nothing there no more no more buttons to press. I think is kind of what what what my sinking feeling is. Yeah I may not absolutely true. The only thing they can do I mean bear in mind the only bought. And they're actually considering pressing as I mentioned is reducing the cards in July. So but that's a great idea. Yeah the only thing they could possibly do. Let me. You've got to bear in mind that the the the really we're back to where we were in terms of geopolitics rushes absolutely fine the US we find the US has got a viable me. Whatever gives about share. It's nimble it can turn around quickly you know the best players and You know they'll be fine The battle you Saudi. Because what is it? I mean there. Virtually they're like Forty fifty over fifty dollars per barrel away from what they need to be on. Barra on that budget break-even price and not just that they also look while the problem. I mean the oil market now's the NBA hasn't a clue so he hasn't actually lost any further ground. More stupid than people thought he wants to school so that is not of France. The boy is that you know. He has damaged even further. Always looking quite tenuous with the various things that Saudis up toward Yemen Kashogi kidnapping for Lebanese Prime Minister. During aim to resign. And all the rest of it. So you know hanging up your Your own relatives and arresting people arrested at home but you know not just out but they went after he won his only real ally You know which was The US and has been since the agreement is in nineteen forty five. Yeah you know. And he's managed bewilderingly. People would think the impossible he's managed to actually make. Russia look quite benevolent because but Russia agreed they said yeah okay. We're big hostage will will as well obviously no. Yeah so they might. Well be trump of the deal under the table might well be be relax on on sanctions against Russia. You know maybe Rosneft will be allowed to reengage more fully in Venezuela and maybe Nordstrom to won't be quite as a talk sake for America is If in fact it really is. That's probably the only thing that would interest either. Those parties is is Nord Stream because I know that They did a pretty good end around on trump done Venezuela by just nationalizing whose businesses are getting sanctioned Very funny was that game over there as well where you try and follow the queen that with it doesn't it doesn't sound familiar. Well you've got three cops on a table three three cups and you've got a you've got one. She's the Queen Colder Mo Monty. Something Not Free Card Monty. Try to follow where you you try to follow where the Queen is yes. Yes that's like trying to follow. Ross trading I do want to point this out for our listeners. When last we spoke you you really get into some excellent detail on the history of the United States relationship with Saudi Arabia. To go over that again. I'm going to know. Oh no iota on tourism letting. Everybody know that you did the do that. I'm going to put in today's show. Notes a link to that show because if that is of interest to you than that other program will be exceptionally instructive tells you everything. I mean the full basis of of the of why the relationship between the US and Saudi is as is and it also explains fully why the US does expect Saudi Arabia to carves. I'm properly carters well whilst losing money And allowing US show producers to make money from higher prices. It's basically it's a tariff on the relationship to keep the house of Saudi empower. That's what it is right. So I'm sure that after listening to to you and I for forty four minutes and seventeen seconds at this point everyone chomping at the bit to go and listen to us. Another forty more so we'll But the full serialized in the in the offering. I'm show or remind me about your new book Yes thank you. It's Actually that's a good point because there's lots of Lots of stuff that we've preempted and Sort of pre analyzed a it's called an insider's guide to trade in the oil markets. that's available on Amazon Kobo and ATF as published by UVF and valuable in that all normal usual places appeals aspects up literally tabs on on the show for that as well and they can check that out so with that Mr Simon Watkins on this. Good Friday. You're a good sport for taking my call in the late evening. Like this so Thank you Sir for being on the show a real pleasure and so we've always a pleasure. I'm sure we'll speak again soon greg. Thank Cameron thank you all right so we just got done. Hearing from Mr Simon Watkins over in the United Kingdom always a real pleasure to have him on the show and I had hoped to have Our editor in chief cred Abraham Join US on a three party call but technology being what it is in the days of Corona virus. We just couldn't make it happen so I have Mr Abraham with us right now to talk to us about where the oil prices ended for the week. And kind of what we can expect coming up here domestically in the face of all this. So Mr Abraham thanks for being with us well thank you Cameron and Finally were at the end of another tumultuous week I couldn't be happier to see the end of the week. Quite frankly with everything that's gone on it all of this whole thing with this OPEC plus deal. It seems to me to be so tenuous and it doesn't seem to amount to enough To put it in shorthand here and I think that the market yesterday reacted accordingly. You know at one point. The price was up. Oh goodness about three dollars. A barrel all the way up to twenty eight something. We're talking for West Texas intermediate and before everything was was done yesterday when people began to figure out that this deal isn't the greatest thing since sliced bread after all that Oil wound up two dollars and thirty three cents. A barrel down Finishing at twenty two seventy six and actually Although the Dow Jones The stock market managed a gain of two hundred eighty. Five points yesterday. That to eighty-five could have been a lot more. In fact it had been well over five and six hundred but The oil sector really brought that back down so obviously a lot of folks in a financial community like ourselves. I would say at this. Point are not impressed with the OPEC plus deal. That does seem to be the consensus worldwide unfortunately there is so much going on so many machinations that even got us to that point. Kurt that I think that's kind of what took the wind out of the sales. It was so much effort to get not very much return and it didn't help. I mean ten million barrels a day normally would seem like an awful lot but in the context of where we are right now It's not that much I mean. I've seen estimates as high a for demand destruction as thirty five million barrels a day. But even if it's only twenty or twenty five ten million is not going to be near enough to have any major effect and then of course you've got these nasty irritations like Mexico at the last minute Saying they were going to raise their output nat lower. It you know. You have to wonder what they're thinking down there that that wasn't a very coherent thought but then again you have to look at. Who'S PRESIDENT DOWN? There are dear friend. Anglo Anglo is Obviously more bent on getting some attention for himself than he is Doing something rational in terms of oil production levels. So you had that going on then then you've got President trump almost like a magician. I guess today was not trying to waive his hands around saying Oh. I'm going to get the Mexicans to cooperate. No we'll take some of their burden. So if that's true what we heard About trump's oil the US will take two hundred thousand barrels. A day of Mexico's Commitment problem and and we'll be responsible for it. I don't see how he can do anything with that and enforce it to you. Well I think that's kind of the catch. Is that when the president thinks about a cut? He's thinking about you. Know natural decline due to reduce demand. So he's that's what he thinks about things about just the gross number of barrels produced whereas the Saudis and the Russians want expect a proactive reduction of barrels produced. So that an something. Simon I just talked about was that is probably where a of uncertainty in the market comes from. And it's GONNA come to a head real quick because they those are two completely different ways of looking at reducing global production. Well and in something to keep your eye on in the meantime in terms of whether this is going to work at all is that the Texas Railroad Commission on. I believe it's Tuesday. The fourteenth is going to have an electronic version of an open meeting in all kinds of strange scenarios are going on due to the corona virus. So they're going to try to do this in some kind of video conference mode. I guess similar to what OPEC plus just did and they're going to have What amounts to an open discussion per the open meeting requirements of the commission about what to do about a output levels in the state. And whether or not to bring back per rationing and you know there's all kinds of problems Caught up with that. You've got A Commissioner Ryan Sitton who obviously would be in favor of that because he's the one who went over to OPEC and talk to OPEC about you know five hundred thousand barrel a day cut right. That's right that's right. Yes you've got the appropriation topic. And then you have the tariff topic which had kind of fallen out of the news for a while until Alberta Premier Jason Kenney said that you know he was in favour of tariffs for North America to include the US and Mexico. And that he'd been in some conversation with counterparts in the US and Mexico on a tariff. So that's why I tend to. I tend to believe Jason Kenney unfortunately more than I do a few of our own officials in the US. The track record to me speaks to that. And so Jason Kenney this coming out saying that there's going to be some kind of deal between the three countries to reduce production. I believe that that's got some legs to it. And a May also account for the fact that the Mexicans Waffling back and forth possible that they got confused and weren't sure what to do either. I'm going to try to give them the benefit of the doubt on that but Yeah so so hats off to Jason Kenney. Because he's one of the few that I think is looking at the situation. Rationally and I believe his quote was yesterday. Somebody has to stop the madness of OPEC plus cannot and I think that adequately Describe the situation and the other thing going back to the commission to talk about is the fact that in the middle of all this craziness About whether or not the. Us is going to participate in the OPEC. Plus deal you. You have to have some kind of output reduction in the State of Texas for that to work if that became necessary and yet we've got individual companies and mostly the very largest operators who've got integrated operations who are benefiting shall we say from the very cheap crude on refining end and they're writing letters to the commission. Say Oh no no no please. We must not have preparation and all that would just be horrible. And yet you've got other what I call pure producers who don't have integrated operations of larger independence. Same please please do something to cut the production it. It's it's very untidy right now and then of course we have our friends at Occidental. You just really have to wonder what is going on at Occidental and and what really annoys me. It should annoy everyone. Who likes to think that they're thinking about this in a clear-headed fashion as that you've got Occidental on one end of the equation saying writing a letter to the commission saying Oh no no please. We don't want any parading. Then we go to the other side of the equation and their Sending Communications to the federal government saying. Oh you've got to give up some relief money. You've gotTA GIVE US relief money to keep paying our employees now. You know how. How crazy is that you know? They WANNA have their cake and eat a to the they want the the overproduction to continue an estate. Because they're sure that it will not out some smaller producers in the Permian and then they can go and enhance their leading acreage position in Permian even further at pennies on the dollar. But they don't want to Endure any financial cost on the front end of this because of the lower prices so they go to the federal government said. Ooh please please give some money. Cover our our risk. You cannot do that. You cannot have it both ways. And it's as if Vicki Hallam over at Occidental wants a federal government to bail her and her team out for making some bad decisions on financial end. Well it's Kinda hard to look at what she's asking for a not come to that sort of a conclusion. Honestly I mean why else would you expect the government to give you money so that you can keep your powder dry to buy out these other players that have been driven out due to the low production but that's the fallacy with all this free market. Talk these folks like throw that term around but in reality Their motives you really do have to question last year. The last topic that you mentioned Than we want to go back to just a second is the whole question of an imported oil tariff and while there was a lot of excitement about this OPEC plus deal at first now. The reality has set in. And I would say to you and I think you would agree that the issue of an imported oil tariff is still very much alive. Obviously Jason Kenney things up in Alberta but just looking at the reality Something's going to have to be done or you're going to see some real carnage In in the equipment service sector among the medium and smaller independence for sure Potentially on the drilling contractors etc so I think the issue is very much alive. The question is exactly where it is a fit in the current Scheme of things. That's a good question. I don't really have an opinion on it yet I am sure that Mister Kenny will be pushing for that. And as you stated I look forward to his leadership on this issue. Because he's a he's a strong leader and I think that he's got a very set position is going to pursue it The whole notion of the service companies and the equipment providers and everything being driven out of business. I've been trying to think of what the analogy would be. I think it's kind of like the ant and the grasshopper maybe Come to the point to where the market eventually recovers and then Gee whiz nobody left to help me. Drew my wells. There's no one to know one to hire the decisions were made that we are making today will determine whether or not we have any sort of success a couple years from now well exactly that. That is the crux of the matter and We just don't know how some of these things are going to settle out over the next few days but is going to be interesting for sure. I would say to our friends who might be listening to this from Norway from Canada from Brazil From other places like Australia and in any other places got some significant production. That could be jeopardized By the current situation I would say to you That it is in all of your best interest for the United States to do something to get the price up whether it's through production cuts or they're through an imported oil tariff or perhaps a combination thereof and. I would hope that they would be supportive of that and would actually communicate that to people here. Yeah all right then with that Kurt. I think we'll Let everyone get back to enjoying their three-day weekend in a home isolation or wherever they happen to be and prepare for what was is bound to be an exciting week next week. So occurred Abraham. Thanks very much for being on the show today. All right. Thank you Cameron. And we'll see what develops all right. Thanks for listening to the daily brief on the world Podcast network if you have any questions or comments on the program please. Email editorial at world oil DOT COM and. Check the show notes for more information about today's episode. Don't forget to subscribe either on Apple podcasts. Or wherever you get your podcast also be sure to visit world oil dot com for more information about today's stories and sign up for our free Daily News Life.
11 AM MARKET MINUTE
"This is market minute by yahoo finance. I mean as for the markets are mixed today as the ten year treasury yield is ticking slightly higher. The nasdaq is under pressure. The snp is also slightly under pressure. The dow is seeing some gains as energy. Stocks financials and industrials are in the green. Wti was sexist. Instrument and brent crude are both higher today part of this has to do with expectations that opec plus will be increasing output rather according to reuters rolling over production cuts from march into april opec. Plus will meet on thursday. The vaccine rollout is also creating some optimism and refiner rates which decrease sharply recently. Its biggest drop in the gulf because of the cold temperatures may have also to do with the bullish prices that we're seeing today. Meanwhile lift shares are hired up about nine percent after some wall street analysts came out with bullish notes. Predicting a demand for the ride sharing service will rebound strongly in the second. Half of the year and apollo has agreed to buy michael's companies for twenty two dollars. A share shares of the craft chain company are trading just above twenty two dollars right now for more market minute. News at to yahoo finance dot com.
Weekly Preview: Risks and rewards in the new OPEC+ deal
"Welcome to the daily brief. The world oil podcast network daily review of Market News, emerging trends, new technologies and the people who are advancing the oil and gas industry. Here's Cameron. Wallace with your top news stories of the day. Hello and welcome to the world oil. Daily, brief podcast I'm Cameron Wallace and today is Sunday June seventh. Yesterday the OPEC Plus Alliance ratified its agreement to extend oil production cuts through the end of July. That agreement has a lot of moving parts and relies on strict compliance countries that don't have a very good track record of hearing quotas. The deal also represents a new more sophisticated approach by the cartel to proactively control oil prices, and not to spoil the surprise, but they may have finally hit upon way to keep us shale producers in check as part of it. Regardless Saturday's activity will have an outsized impact on the oil and gas industry this week. Before we get started with that. Take a quick look at the week. That was. Baker Hughes updated its drilling rig count. Friday and we continue to see those numbers reflect capex budget cuts and weaken global demand. The US Land Rig. Count stood at two hundred eighty four rigs on Friday down seventeen rigs for the week and down six hundred ninety one rigs compared to this day one year ago. Meanwhile, Canada has added one rig, bringing their total to twenty one and the international rig count fell by one hundred and ten rigs to eight hundred five. Amid falling rid counts, oil prices log their six week of price gains. Thanks to OPEC and continuing Chinese demand growth West Texas intermediate closed the week up two dollars and fourteen cents to thirty, nine, fifty, five, a barrel while Brent closed up two dollars and thirty one cents to forty two thirty barrel. So now as we look forward to coming week, let's take a little deeper look at the OPEC plus agreement. There's a lot more to it than just tacking thirty days onto the schedule has some significant implications for both members and non members. Yesterday OPEC plus agreed to a one month extension of its record oil production cuts and adopted a stricter approach to ensuring members. Don't pump more than they pledged. The deal will underpin all markets recovery easing the financial pain felt by resource, dependent emerging economies show explorers in Texas and blue operators alike. According to consultant would Mackenzie Brent. Crude prices could rise to as much as fifty dollars a barrel this week. It's a victory for Arabian. Russia who put a destructive price for behind him to cajole Iraq Nigeria and other laggards to the filler promises to cut production. The two leaders of OPEC plus show that they intend to keep a close watch on the oil market. The group's monitoring committee will now meet every month to assess the balance between supply and demand amid certain economic recovery from the global pandemic. Saudi, Energy Minister Prince Abdulaziz Bin Salman said our collective efforts have borne fruit, and despite many uncertainties, there are encouraging signs that we are over the worst. Demand is returning as big oil. Consuming economies emerged from pandemic lockdown. After a video conference lasting several hours on Saturday delegates said that all nations had signed off on a new deal for production cut of nine point six million barrels a day next month. That's one hundred thousand barrels a day lower than the reduction in June because Mexico will end its supply constraints, but a tighter limit than the seven point, seven million barrels a day set for July in the group's previous agreement. In addition any member that doesn't implement all its production cuts in May and June will make extra reductions from July to September to compensate according to an OPEC communique. Those promises are a particular indication for the Saudi minister who has consistently pushed fellow members to stop cheating on their quotas since his appointment last year. But they could also add to risk in theory. The entirety of the twenty three nation production agreement, which runs until April, twenty, twenty two is now contingent on every member, making one hundred percent of their pledge cuts. That something that's rarely achieved in the three and a half years at places existed or indeed also the decades long history of the Organization of Petroleum Exporting Countries itself. Oil has just posted a sixth weekly gain in London more than doubling since April with traders, anticipating tighter supplies as demand recovers from lockdowns. US, president, Donald, trump on Friday hailed the cuts OPEC allies for saving America's energy industry. US Energy Secretary Denver. Yet also welcomed the deal on Saturday. Saying quote I applaud the OPEC plus for reaching an important agreement which comes at a pivotal time as oil continues to recover and economies reopen around the world. Russia's Energy Minister Alexander Novak said in opening remarks at the meeting. The oil market is still in a fragile state needs support that is why this meetings more than ever is important to adhere to one hundred percent compliance. The group hopes to build on its success by pushing the market into supply deficit next month, taking advantage of a price structure called backwardation to chip away at the billion barrel of oil stockpiles, the built up during the pandemic. There was no discussion at the meeting about the future of the additional one point, two million barrels a day, voluntary cuts being implemented by Saudi Arabia and its Gulf allies in June. The cartel meet again in the second half of June for another review, the oil market. Talks are scheduled on June. Eighteenth for the Joint Ministerial Monitoring Committee which could recommend a further extension if it's deem necessary, which would push the production cuts into August? That panel is set to meet every month until December. The next full ministerial OPEC plus meeting has been scheduled for November thirtieth to December the first, although the communique notes, that conference could be held whenever it is required. Cutting production is always painful for oil-dependent states Iraq in particular needs every penny, because it's still rebuilding its economy, following decades of war sanctions and Islamist insurgency. The country amid listen half of its assigned cutbacks last month, so compensating fully would require to slash production by a further twenty four percent to three point, two eight million barrels a day. Accepting such could risk of backlash from Iraqi parliamentarians and political parties not want to bow to foreign pressure. The traditional shirkers, and plus promise many times before to do better, but some some analysts are skeptical that it'll be any different this time. There's also a risk that future OPEC plus curbs could be undermined by return of Libyan oil. The civil war there halted more than one million barrels a day production, helping pick plus rebels the market. But a ceasefire on Saturday, now opens the door for gradual recovery of supply. For now at least members of OPEC, plus can enjoy the price gains resulting from the deal. The oil mark is on its way to recovery, said Ann Lewis Hill an oil analyst of wood, Mackenzie supply shifted dramatically already. Global demand is recovering to with both May and June climbing from the lowest seen in April as the coronavirus, related shutdowns continue to ease. Now on the surface. This agreement might look like more of the same old plus strategy of cutting production. But a closer look shows subtle changes that point of Saudi Arabia Russia and their OPEC plus allies adopting a more sophisticated approach. That being trying to flip the shape of the oil price curve upside down. In many respects, the cartels borrowing from playbook of the world's top central banks or policymakers often focus on interplay between long and short term investment rates. The alliance's traditionally targeted a reduction in inventories, but now it's also actively focusing not just on stockpiles, but also on the shape of the oil curve, designing policy to influence short term prices relative to those further in the future. The idea within OPEC plus is trying to push near-term or spot prices higher than forward contracts structure known among traders as backwardation. In short OPEC wants oil today to be more sought after than oil for delivery months or years into the future encouraging refiners and traders to take root out of inventories. This marked a departure from previous aims to draw down inventory, more subtle way of communicating in. The shift first reported by Bloomberg on Friday could have important implications for US shale producers who benefit from higher longer dated prices as they used them to hedge their future production. While front month West Texas intermediate remains slightly below forty dollars a barrel. The price of twenty twenty one is trading higher and the price for twenty twenty two is almost forty to fifty a barrel. Brent price curve remains in tango. The term for market where long-term oil is more expensive than short. Although earlier this week, the front of the curve briefly flipped into backwardation. This price difference between contracts for delivery now and in six months remains in tango although it has narrowed significantly over the last two months. Controlling the shape of the curve is difficult, would require OPEC plus to make short-term adjustments to its output, reacting quickly to changes in supply and demand. But there are signs. OPEC pluses adopting more nuanced policy approach, extending his deep output cuts by a single month rather than committing to a longer period. For the OPEC. Plus Alliance, the ideal scenario would be to move the shape of the curve from his current tango, where near prices are lower than future prices into a mild backwardation was spot prices higher than forward ones. Cartels Preferences Shallow backwardation about twenty to thirty cents per barrel per month right now. The West Texas Intermediate is on a Mild Tango fifteen to twenty cents per barrel per month. Damian on an oil analyst at Goldman Sachs, so we believe that OPEC remains focused on sustainably increasing revenues through a combination of higher prices, but also higher market share. Structurally this conference us in our long held view that OPEC will start targeting backwardation rather than higher prices alone. Finally today. In case we needed any reminders of the risks that face the OPEC plus producers. Libya's biggest oilfield is gradually resuming production after a five-month shutdown as regional powers push to end the country's civil war. The restart the Shahara field in the southwest comes after lengthy negotiations with militants to reopen valve closed in January, the state. Run National. Corporation said on Sunday. Production will resume at initial thirty thousand barrels per day and take three months to return to full capacity due to damage caused by the shutdown. Shahara was using three hundred thousand barrels a day before the cut-off amid an offensive by Khalifa half Dr who leads a rebel military force base in the countries east. The field resumption follow setbacks in recent weeks for half tires forces. They've lost stronghold in western Libya after battling for more than a year to seize the capital Tripoli from the United. Nations back government of Faez L. Suraj. Halftime had accepted an Egyptian sponsored. Cease Fire over the weekend, although Sarraj is, administration said Sunday is fighters will continue their offensive to retake two key cities before any political negotiations. After. Supporters have blockaded major oilfields imports since January cutting output in the north African nation from as much as one point, two million barrels a day to just ninety thousand barrels. Libya Africa's largest proven crude reserves and the collapse production has had the inadvertent effect of helping the OPEC plus alliance prop up oil prices, following the route of March and April. And there you have it a closer. Look at the OPEC plus production agreement that will be the prime mover of oil and gas industry activity this week. To learn more, please visit, world, oil dot com slash news. I'm Cameron Wallace thanks for listening today. Thanks for listening to the daily brief on the world oral podcast network. If you have any questions or comments on the program, please email editorial at world, oil, dot, com, and check. The show notes for more information about today's episode. Don't forget to subscribe either on Apple. PODCASTS or wherever you get your podcast, also be sure to visit world dot com for more information about today stories and sign up for our free daily newsletter.
As Demand For Oil Dries Up, OPEC And Allies Agree To Historic Cuts In Output
"Been a news over the weekend. Many of the world's oil producers have agreed to cut production to prop up prices. Npr's Camilo Domino ski reports on their deal. The average price of a gallon of gasoline in the United States is well under two dollars but many people aren't filling up because they're not going anywhere that's the state of the oil market in a nutshell. Oil is super cheap. And there's not much global demand. What's that done to oil producers? Here's Muhammed Burkino. The Secretary General of OPEC on Thursday Industry. Mr Chairman is hemorrhaging. No-one has been able to stem the bleeding. In fact instead of stopping the bleeding Saudi Arabia and Russia were adding to it by waging a price war against each other. But now they've called a truce and OPEC is trying to put a bandage on those wounds. Actually it's OPEC. Plus the oil cartel has expanded from its core members to include allies like Russia and Mexico and when Mexico threatened to derail this deal. President trump stepped in. We are trying to get Mexico as the expression goes over the barrel the. Us is the world's largest oil producer and American oil and gas companies have been hit hard by low prices. President trump is often hostile towards OPEC. But this time he helped them out. The new deal is massive nearly ten million barrels of oil per day in cuts. That's the biggest deal in OPEC history but the drop in demand than twice that amount. Rozsa Dewan is an oil strategist. Ihs market but there's no cut that can match that degree of shrinkage in the market possible so despite the new deal oil prices are still low. In fact says the steel isn't about propping prices up. It's about avoiding the collapse of the oil industry. Camilo Domino NPR news.
OPEC Oil Production Hits 20-Year Low Amid Cuts
"You're listening to the news at this hour. An Africa Business Radio. A survey Bayreuth is found that the Organization of Petroleum Exporting Countries saw. It's all outputs. Hit the lowest in two decades in June Saudi Arabian Golf. Are members made larger conce, the group compliance with the supply reduction pats rose above one hundred percents despite incomplete adherence by Iraq Jerry. The Thirteen member OPEC com, twenty two point six two million barrels per day, an average in June. The survey found down one point nine two million barrels per day from as revised PGA. OPEC, and its allies in April agreed to a record outputs count to offset slum in demand caused by the coronavirus crisis, an easing of lockdowns and lower supply have helped prices climate, forty dollars from April, twenty one year low of below sixteen dollars a barrel. and. That was the news at this time. In Africa Business Radio, he can continue to in life online at stop you W. W Africa Business Radio? Dot Com or I'm APP. Thank you for listening.
OPEC+ Countries To Hold Talks On January 4
"You're listening to the news of this hour on africa business radio. Algeria state news agency said algerian energy minister abdomajid on top on sunday said that opec class countries will meet on january four to study the market after the allows decision to the production rises to five hundred thousand barrels per day. Starting next year the minister's comments came after the conclusion of a virtual meeting of the organization of arab petroleum exporting countries. And that was the news. At this time on africa business radio you can continue to listen live online ads. Www dot africa business radio. That's com or arm app. I am rachel she gender. Thank you for listening.
The World Has Too Much Oil
"I'm Jack how hosted the new baron streetwise podcast on business and investing this week. I focus on Disney and how the pandemic might change theme parks movies and television. Here's Disney executive chairman. Bob Eiger just as we now do bag checks for everybody that goes into our parks. It could be an at some point. We had a component of people's temperatures beyond the pandemic. On this week's Barron streetwise. Subscribe on Apple podcasts. Spotify or wherever you listen to podcasts. Russell Gold has covered oil for almost two decades. Oil is what makes modern society function. It's the gasoline in our tanks. It's the plastic in our lives. Now all of a sudden we've just stopped using it. No one's sure exactly much less oil were using. Since the corona virus became a global pandemic. But with so many planes grounded and cars off the road. It's a lot less. I sit and I look at the numbers I talk to people. I try to understand and I just can't wrap my mind around the fact that we've essentially stopped using an enormous amount of oil and when oil demand craters and there's still a lot of supply on the market. You know what happens? Look AT OIL. Prices completely decimated tumbling touching levels. Not Seen since two thousand and three. The average price for gasoline is two dollars and twenty three cents per gallon all the way down in fact his falling in about two cents a gallon every day. The only way to get oil prices backup is for producers to cut the supply of oil. But here's the weird thing for the last couple of weeks. No one has been willing to do that. Everyone in the global oil industry understood that they needed to come a lot from the market but nobody wanted to be the first one to do that. Because the first people who do that they're gonNA lose market share and they're going to lose revenue so collectively we just had all these oil producers continuing to produce continuing to produce hoping that somebody else is the one to make that sacrifice to shut their wells down. And that's why sort of see this as a global game of chicken. Everyone was driving at very high speeds toward each other. And hoping that the other person veers off at the last second today on the show how. The oil industry found itself caught in a global game of chicken. And how it's trying to save itself from a historic glut of oil. Welcome to the Journal. Our show about money business and power. I'm Kate Linebaugh. It's Friday April tenth. There are a lot of reasons why no one wanted to be the first to stop pumping oil if you're an oil producer and you shut off your well. It might be good for oil prices. But it's not good for you. You quit the market and your competitors are going to fill that gap and take your customers but it gets worse when you do start pumping oil again. You're going to be hit with a huge bill because when you shut your well down. It's not just a matter of flipping a switch and then flipping back on and a few months when you turn the whaleback on you might have lost pressures. You'RE GONNA have to spend a few million dollars to put the pressure back in the well so it starts to flow. It's a very difficult situation to stop and restart your industry and no one wants to be the country or the company to undertake that so after the corona virus took hold around the world. Everyone just kept pumping and the price of oil just kept dropping This was bad news for big state oil producers who depend on oil money to drive their economies and support their political regimes but it also hurt American producers to like those in West Texas in an area called the Permian Basin in the Permian Basin. I did a back of the envelope. Calculation if the benchmark price of oil in the United States is about twenty five dollars that probably means physical barrel in West Texas Fetches Twenty Twenty Dollars. The premium basin producers are losing. Maybe two hundred million dollars a day and can they sustain that. No you're going to have a large swath of the Shale. Oil operators that are going to have to seek bankruptcy. They're ready under financial pressure because they were spending more money than they were bringing in. I suspect we would see a lot of consolidation and a lot of bankruptcies. What would that mean for the American economy? Well it certainly wouldn't be helpful to the American economy. There are thousands tens of thousands of jobs here in Texas and North Dakota and Oklahoma that would be affected. I mean maybe one of the ways to think about this. Is that coming out of the great recession of two thousand eight two thousand nine one of the things that lead the country back out was that Texas was a fairly strong economy. Didn't get impacted that much. This time around Texas will not a sort of an engine point the rest of the country Texas will be the caboose are that the rest of the country is GonNa have to pull all this turbulence in the oil market. It's not just happening. Because of Corona virus the international game of chicken started in early March before corona virus was declared a global pandemic. That's when oil markets suddenly stopped working the way they had for decades since the nineteen sixties a group of oil producing states have worked together to regulate the price of oil you know them as OPEC OPEC cartel of oil producing nations would get together and when the market was oversupplied they would cut back on supply. When the market appeared undersupplied they would increase supplied. Opec's goal is to keep oil prices in a goldilocks zone. A NICE MIDDLE TO HIGH PRICE. Where people can get the oil they want. They can get it at a price so that the oil producing nations have four coffers and the market is smooth sailing. Saudi Arabia played a key role. Here it produce so much oil. It's actions alone can affect oil price so it was the group's so called swing producer when oil prices needed to go down. Saudi would pump more oil. Prices needed to go up. Saudi would pump less and take the financial hit Saudi Arabia a few years ago. Got A little bit tired of being the only swing producer. So they said look. We don't WanNA swing alone. We want Russia one of the three big oil producers in the world. Us Russian Saudi Arabia. We want Russia's join with us so we had something called OPEC plus an opaque plus pretty much was Saudi Arabia n Russia acting together figuring out. How much oil they can put out in the markets. This works for a while but early last month that alliance between Saudi Arabia and Russia fell apart. Saudi wanted Russia to cut some of its oil production but Russia didn't want to it didn't swing with Saudi anymore and so- Saudi Arabia pulled a power move. It started pumping more oil or absolute. Saudi Arabia has said we're going to increase production of oil right now and then. They were matched by. I believe it was Kuwait in the UAE so effectively as mid March OPEC stop functioning as a cartel. They stop functioning as a market regulator. What we're seeing right now is a free market of oil for the first time in. I don't know six seven decades and that's what's both so scary and so exciting about this is that in a way we've been bowling with the bumpers on and the bumpers just went down for the oil industry. This timing could not have been worse. Foil demand and oil prices were about to drop off a cliff because of the Corona Virus. And now there was no cartel to force prices back up. It was every oil producer for itself. Coming up how. The oil industry is fighting to survive in a world flooded with oil technology. It's in your pocket your car. Your Business and the Wall Street. Journal's Tech news briefing is tracking all of it from consumer tech to cybersecurity from the giants to the startups every weekday. We bring you the latest stories about the companies and advancements that are changing the way we live and work tech is remaking the world. We'll make sure your part of it subscribe to the WSJ tech news briefing from the Wall Street Journal. Wherever you get your podcasts. Welcome back after the blow up between Russia and Saudi Arabia it no longer benefited oil producers to work together to regulate prices instead. Everyone was trying to grab market share for themselves. One way they did that was by undercutting each other on price to try to steal each other's customers but another way was by kicking off a secondary war a storage war in a world where we're producing millions of barrels a day of excess crude the countries in the companies. That control storage are in a position because they can continue pumping they can fill up that storage. They have a place to go. That's power no one is buying all that oil producers are still pumping but producers. Still have to put it somewhere so they're searching for more storage looking for a place any place to park their oil thirteen reports of trains that are used in the United States and Canada and move oil around the filling up like hundred car trains and just parking him. Sounds like my creative use of my refrigerator. Now as I stuff at full of two weeks of Kovic Shopping. Yes exactly exactly. I mean I was joking around with someone saying I can't wait till the first person you know flies over some backyard Houston and find somebody who's emptied out their backyard. Pool filled up with crude oil. I mean it's going to happen sooner or later so in this storage war. Is Anyone winning both Saudi Arabia right after they said that they were GONNA increase? Production went out and leased out by our count about twenty four of these giant crude tankers. That actually called the very large crude carriers. These are big ships that carry oil enormous ships. Yes so big that they have trouble fitting through the Panama Canal and Saudi contractor with these ships. Just to store its own oil. There's actually a term for this in the oil industry oil on the water. Russell says there's a lot of oil on the water right now but storing oil in gigantic ships and railcars. Those are temporary solutions eventually. The system will seize up. The world will run out of oil storage. The experts that we've interviewed said. We're probably talking three weeks four weeks. No one's quite sure but eventually we're going to have to see a wholesale shutdown of the industry you can't just keep producing oil. The no one wants so to avoid that shutdown this week. Opec and Russia came back to the bargaining table to see if they could strike a truce to raise the price of oil and save their industry. The OPEC meeting that happened must have been the most heavily anticipated. Opec meeting in twenty years or more. Everyone wanted to know whether Saudi Arabia was gonna Blink whether Russia was going to come to the table whether those going to be a grand coalition of lots of countries. Coming together to stabilize the oil markets. Russell says this meeting was crazy. Saudi and Russia wanted to get each other to cut production and they were also pressuring other countries to cut their production to things got so heated that at one point the Mexican delegation left. The meeting. Mexico eventually came back and in the end. There was a deal. The bottom line is that Russia and Saudi Arabia have agreed to a six million barrel a day cut which they're hoping will grow as some of the other countries in OPEC oil producing nations possibly even including the United States. Join within the next couple of days. We'll traders were not particularly happy with that and oil actually ended up down about ten percent on the day after starting the day. Very high with high expectations so even though Sadie Arabia and Russia are cutting production after this meeting. Oil prices dropped. Can you explain that? Sure traders wanted more if you're going to balance the market you need cuts significantly more than six or ten million barrels a day and there were warnings from OPEC that have collectively. The oil industry keeps producing too much oil and filling up storage. You're going to be looking at oil prices in the single digits below ten dollars a barrel. When was the last time? Oil prices were below ten dollars a barrel. Oh my goodness you probably have to go back to the nineteen. As last time you saw prices this low but to put these cuts in perspective these are also the biggest cuts that OPEC has agreed to. Well that's what's so amazing. This is the largest cut that anyone can remember. And yet it wasn't enough and that in a nutshell is just the extreme position that the oil market finds itself in right now Russia and Saudi Arabia. Coming back to the negotiating table and cutting a deal wasn't enough to raise oil prices. It also didn't change the fact that the world is going to run out of oil storage at most. This deal bought oil producers just a little more time but Russell says that when that time is up the landscape for oil producers could look really different. One of the fascinating questions that we're dealing with right now is that we're going through this extended period of time where people are learning that you know. Maybe I don't need to fly to every meeting. I have maybe I can do more online meetings. There's also a chance that a lot of people coming out of this because of growing concern about international travel won't want to travel as much as they had in the past so one of the fascinating questions is we went into this period where they global hundred million barrel a day oil market. What are we gonNA come out of? It is nobody believes we're going to come out at one hundred million but we're not sure. Is there going to be ninety? Five million and how much is the market going to shrink? We just don't know how big that is yet. That's all for today. Friday April tenth. The Journal is a CO production of Gimblett and the Wall Street Journal. Your hosts Aranka Knutson and me Kate. Limbaugh shows made by Peter Resident Gerard. Cole p God Cari for needed Jablonski. Anti Munaf Ricky Vet Ski. Sarah Platt will Aruban Anti Rose Strasser and robs if co our show is engineered by Griffin Tanner with help from Sam Bera. Our theme music is by so widely additional music. This week from Katherine Anderson. Peter Leonard M among So widely Bobby Lords keen collective and blue dot sessions special. Thanks to joy crain. Thanks for listening. See You on Monday.
"This marketplace podcast is brought to you by. Indeed, are you hiring with? Indeed, you can post a job in minutes set up screener questions than zero in on your shortlist of qualified candidates using an online dashboard get started today at indeed dot com slash marketplace. That's indeed dot com slash marketplace. Fixing machine known as OPEC, I'm David Brancaccio in New York, the organization of Petroleum Exporting Countries OPEC is a cartel at fixes prices for a living which is illegal in so many other industries. But now there's a bipartisan move in congress. That would let the US sue OPEC for this behavior. US oil companies don't like this. But President Trump might my colleague marketplace's Nancy Marshall genzer joins us from Washington. Nancy? Let me say it again. It's a cartel. That's right. It is OPEC's sets oil prices, but it can't be charged in the US with price-fixing because it's protected by sovereign immunity. Now, congress is considering legislation that would eliminate that immunity. What's the Bill? Well, it's called the no oil producing and exporting cartels act, or no pack, and it would authorize the Justice department to sue OPEC members for antitrust violations. So OPEC could be. Charged with illegal pricing. Now, the House Judiciary committee has already passed the Bill and it was introduced yesterday in the Senate chance could get through congress. It has a chance it has by partisan support. The question is will President Trump's sign it? The president has been supportive of Saudi Arabia, a major OPEC member, but he's also criticised OPEC. And at one point he accused it of ripping off the world, and what's the oil industry's view here? The American Petroleum Institute and the US team of commerce say OPEC could retaliate if the Bill passed remember when OPEC control supplies to increase oil prices that also helps US oil companies because they also get to charge those higher prices. All right grew oil traded in New York is down three tenths percent. Fifty two dollars and thirty five cents a barrel. Now. Moving onto the food and Drug administration. Putting Walgreens on notice this week after it was tracked illegally selling tobacco products to underage buyers over the years chains like right, eight WalMart Dollar General have gotten in trouble for this CVS got out of tobacco sales about four years ago. Marketplace's Eric barris reports the FDA says twenty two percent of the Walgreens stores it's inspected since twenty ten we're selling tobacco products to minors. And this week the agency filed a complaint block a Miami store from selling tobacco products period for thirty days. Robert Proctor a scientist story. And at Stanford says performances so much money is is to be made of cigarettes that that's why the you know, it's like a second addiction by the time. The FDA moves to ban store from selling products like cigarettes and chewing tobacco the stores already. Been find many times Andrew the Lancy a public health researcher at the university of remote says stores like Walgreens and Rite Aid. Are easily accessible to minors and can create a false impression a place where you're, you know, purchasing products to benefit your health that you are confronted with tobacco products behind the counter seems to normalize it. The FDA says it will request a meeting with Walgreens discuss things like employee training and additional enforcement. Walgreens said in a statement that it's taking steps to eliminate the sale of tobacco products to minors America barris from our place, the stock market, the footsie, Nixon London is up a single point. Dow futures here are down four tenths percent each. I'm Shepard from Lincoln Nebraska, and I listened at marketplace several times actually every day because it's got the economic news and developments of important to me donate to marketplace. So that it can be available to everyone and ask her hope you'll be join me in this effort. Thanks to join Shepard. As a marketplace investor donate online. Marketplace dot org. This marketplace podcast is brought to you by Kronos known compliments you in their paycheck is correct. But make one mistake, and you risk alienating your entire workforce. With Kronos, they make sure your payroll is done, right. The first time from punch to paycheck embedded checklists. Simplified were close a single source of truth. HR payroll talent and timekeeping in one unified system all with a proven implementation approach and simplified transparent pricing. Learn more at Cronos dot com slash payroll. Kronos, workforce innovation that works. Calls are growing among Democrats to expand Medicare the seven hundred billion dollar program. Mainly for seniors might be a route to universal health coverage. Blake farmer of WPN has some views from Tennessee poll show Medicare has remained popular among sixty million enroll es were mostly seniors. Mindy Bates of Nashville whose middle aged with a pre existing condition would welcome the guaranteed coverage. She's been fighting an aggressive form of leukemia and had to go without insurance. For the Affordable Care Act. This could go away, and I would become one of hundreds of thousands of people who would be in the same boat Medicare for all would basically end private insurance and establish. The government is the single payer Senator Bernie Sanders says his plan would save the healthcare system money overall. But once that he says, it would still cost the federal government more than thirty trillion dollars over a decade that price tag could explain why democratic presidential hopeful Senator comma Harris has floated a more incremental idea like letting people buy into Medicare Medicare for all is a non starter from any outside and within the healthcare industry concerns. We have is it dismisses the progress we have made Lauren Crawford shaver leads hospitals doctors and insurance companies in blocking the effort. They wanna focus on widening coverage within the ACA like making sure holdout states expand, Medicaid, which primarily insures people with low incomes law. Lobbyists frame-they're. Their concerns is protecting patients, but they're also defending their prophets Medicare pays far less than commercial insurance. Chip Kahn had the federation of American hospitals. If providers and doctors received only Medicare payment for all their patients, frankly, many hospitals wouldn't be able to keep their doors open, though, not all hospitals would dismiss Medicare for all. We find it intriguing Rebecca jolly represents rural facilities in Tennessee disproportionate share of people without any insurance. I think having dependability in reimbursement is attractive to a rural community for sure. Decent pay through Medicare looks pretty good. When the alternative is no reimbursement. At all in Nashville. I'm Blake farmer for marketplace. If details are worked out today about four hundred twenty-five Sears and KMart stores could stay open preserving forty five thousand jobs for now. Sears chairman Eddie Lampert yesterday. Got a judge to agree to his? Five billion dollar rescue attempt. The alternatives would have meant an end to Sears critic see Lampard as the major reasons here's was in such a mess and of painted him as either a robber baron or a naive. The bankruptcy judge address Lampard billionaire hedge fund manager who telephoned into the core proceedings. The judge told Lampert to do right by his remaining employees and other stakeholders and avoid becoming what the judge called the cartoon character conjured by his detractors, executive producer here is Nicole Childers. Our digital producer Miguel. Contreras engineer, Brian Allison and David Brancaccio with the marketplace morning report from APM American public media. This marketplace podcast is brought to you by. Indeed, are you hiring with? Indeed, you can post a job in minutes set up screener questions than zero in on your shortlist of qualified candidates using an online dashboard get started today at indeed that com slash marketplace. That's indeed dot com slash marketplace.
Are you ready for some football economics?
"This marketplace podcast is supported by transfer. Wise. The smart new way to send and receive money internationally join over eight million customers in eighty countries who are already saving and try it for free at transfer wise dot com slash marketplace, or download the APP. Traveling for Labor Day, a little history of one part of gas prices. From marketplace I'm Kimberly Adams in for David Brancaccio this Labor Day weekend gas prices are about fourteen percent cheaper than if you happen to be traveling by car this time last year that's according to AAA what happens with oil and gas prices depends in part on decisions made by the Organization of Petroleum. Exporting Countries, we usually call it OPEC and the group is coming up on a big anniversary. Next week OPEC is about to turn sixty marketplace's Scott Tong has more OPEC was formed in nineteen sixty governments have key oil producers push back against the company's drilling on their land historian. Giuliano Garavini is the author of the rise and fall of OPEC OPEC was math alerts to gain some leverage. With these international companies to have US say in the price of petroleum, the groups have mixed record on keeping prices. Stable says, consultant Bob, McNally President to the rapid and group today OPEC has joined forces with other producers to manage the market six years ago in a price bust OPEC leader Saudi Arabia asked Russia to join an cut supply together to raise prices it first Russia's said, no in prices fell to about twenty six dollars a barrel then Russia decided to say, yes, there's nothing like an oil price bust to concentrate the minds of oil producers. The future will bring more tests if prices rise after COVID Kano, pick control the volatility and in a world trying to quit fossil energy what Will its role be I'm Scott Tong for marketplace the NFL season kicks off. Thursday. The Wall Street Journal reports. The NFL revenue could fall as much as four billion dollars in two thousand twenty depending on how many people can eventually attend games in Los Angeles developers built a new stadium with room for seventy thousand people. But right now, there will be no one in the stands. Marketplace's Andy Euler looks at how the current families reality could. Change Future Stadium Projects. So Fi stadium in l. a. cost almost five billion dollars in private money and there were promises of one hundred million dollars in tax breaks and reimbursements to lighten the bill. The cell to local authorities was that new stadium's create jobs. And increase tourism spending but with no fans unquestionably, it's a tougher sell Andrew. Zimbalist teaches economics at Smith. College. He says many cities and states are in a budget crisis tax revenues to pay for local services or down across the nation a situation that was already very difficult financially for cities and states to help out with the construction of new stadiums. Now is an impossible one and he says that's going to be the case for a while which Michael leads a temple. University. Says a positive development because it's very limited economically only a small number of agents who benefit from this like sports, bars and souvenir shops located near stadiums. But for a cities overall economy, he says there's little the gain. I may dealer for marketplace. This marketplace podcast is supported by customer dot Io. Are you ready to supercharge your marketing tech stack tech savvy marketers choose customer dot io to automate their emails, push notifications and text messages with a simple API and an easy to use interface. You can segment your audience by who they are at what they do always updated in real time and with industry leading customer support, you'll have dependable help if you need it. To schedule a personalized demo to customer dot io slash Mr, and say you heard this ad that's customer dot co slash M M are. Working on a do it yourself project this holiday weekend or perhaps just binging watching other people do projects on TV. Well, one designer is trying to bring more diversity to home design shows Victoria Rowell's host and executive producer of the show trash versus treasure which airs on cable channel you MC and streams online. Good Morning. Good. Morning. So. How has the pandemic changed the way that people think about and spend money on their homes? I think that people that are fortunate enough to still have their homes struggling to hold onto their homes trying to stay in their apartments, they are looking to shop their own closets shop there pantry shot their basement shop. Their garage everything has value and trash versus treasure. It's a teachable moment with this show. To encourage people to see value in what's in plain sight there has been quite a bit written discussed about the boom in home improvement projects while people have been on lockdown what has that meant for you in terms of how you think about your show well, I've long wanted to produce shows that really show our population are black and brown and minority populations. single-parent populations, households who live on the fringe lived below. The poverty line spent eighteen years in foster care. I saw how people struggled in sacrifice to make space for me. I was given a cardboard box as a dresser and I was grateful I had my own room with the cardboard box people live like this, and so my goal for trash versus treasure was not only to do a show that was not tone deaf that reflected millions upon millions of people not only domestically but globally. Who put value in a piece of cardboard. Lots of people are trying to carve out a home office or eight virtual learning space in their homes. Couple quick tips for people trying to adjust to our new reality. If you don't have Arne Ironing Board get one. If you haven't ironing board, it has at least three different levels. There is the dining level. Then you can lower one more level and it becomes a desk. You can lower it one more time and it can become a coffee table, but I want to encourage people that home is what you make of it and you can make it beautiful. Everyone deserves to live in dignity and beauty, and this is truly a painful time where people are facing eviction. Prayers. Go out to them, but they need more than prayer. Victoria relative is host and executive producer of the show trash versus treasure. Thank you so much. My pleasure. There's more of my conversation with Victoria arrival. Marketplace dot org and I'm Kimberly Adams with the marketplace morning report. From Apm American. Public Media.
Wall Street Breakfast June 1: OPEC+ Policy
"Support for this. Podcast comes from invent together. I bet you didn't know that inventing activity by black inventors peaked in eighteen ninety nine and it has never recovered black and hispanic college graduates patented half the rate of white college graduates. That's just one of the reasons why you need to know about invent together. When our patent system gets more diverse our nation will get stronger and more successful. Find out how you can help. Diverse inventors and unleash economic opportunity at invent together dot org. Welcome to health as wall street breakfast. Your daily source of market news and analysis. Subscribe to this podcast on apple. Podcasts google podcasts. Spotify stitcher good morning. Today is tuesday. June first our top stories today opec plus policy inflation remains in focus and trillion dollar deficits essential or detrimental leading today's news. The latest opec plus gathering takes place via video conference today as pandemic travel continues to prevent the usual meeting spot in vienna. The group is now holding monthly meetings. Giving it more immediate power to make decisions on current oil market conditions as well as room to maneuver. It's also a signal that opec plus producers are wary about how things might play out in the months as they try to balance expectations of a recovery in demand against a possible supply increased from iran. The world's fourth largest crude producer backdrop opec plus decided in april to return two point one million barrels per day to the market from may july anticipating rising global demand despite surging kobe cases in india. Since the announcement crude prices have risen from sixty dollars toward the seventy dollars level and are up more than thirty percent in twenty twenty one alone. Oil has still been trading in the tight sixty to seventy dollar range for the past three months as talks. Continue on the future of the. Jcp away a deal. Revival that would lead to higher iranian output wti crude futures climbed another three point one percent overnight to sixty eight dollars and thirty four cents per barrel ahead of the opec. Meeting russia is expected to seek to accelerate the pace of the ramp up in output but the saudis may call for keeping the more conservative increase given the high. Kobe case counts in india and japan as well as the looming return of iranian exports in the back half of the year said rbc capital markets outlining that opec plus is set to stick with its cost. Production returned schedule. The group is also unlikely to decide on output policy beyond july since the outlook for iran is not yet clear and opec has another reading plan for june twenty-fourth yesterday opec's joint technical committee revised global supply down by two hundred thousand barrels per day and now expects a deficit of one point four million bpd in twenty twenty one from one point. Two million bpd previously meaning inventories faster than expected thought. Bubble western oil majors are under pressure to cut carbon emissions faster especially after the courtroom and boardroom defeats he last week at exxon chevron and shell new energy policies proposed by the biden administration are also discouraging the production of fossil fuels meaning more business for opec plus and the lights of saudi aramco. Add knock and rosina. It looks like the west will have to rely more on what it calls. Hostile regimes for its supply joked a high level executive from russia's gazprom. Well it will take time to boost america's renewable power grid which could lead to higher oil prices in the interim some say the. Us may have the last laugh. If fossil fuel dependent economies fail to shift away from oil and gas in the future that could be susceptible to economic instability and stagnation and in the decades to come however many wealthy countries still have outsourced a large chunk of their carbon pollution overseas for quite some time and that could continue in a future world price. Differentials play out in the energy mix in other news. Traders are returning for memorial day with renewed optimism as stock index futures point higher following the holiday weekend dow futures are up point five percent while contracts linked to the s. and p. Five hundred and nasdaq ahead by point. Four percent more records while the benchmark and p five hundred is starting june. After notching fourth consecutive monthly gain the inflation debate continues to remain in the headlines quote overall given the market's reaction to friday's release investor concerns about inflation may have been exaggerated or perhaps already priced in said chris hussy a managing director at goldman. Sachs consensus may be building that the inflation we are seeing today is good inflation the kind of rise in prices that accompanies accelerating growth not a monetary policy mistake. Many are still concerned about the risks of a market crash sort interest in spy recently. Hit its highest. Since december and the skew index rose to the highest level since august eighteen hedge funds have also slashed their holdings and twenty of the twenty three commodities backed in the bloomberg commodity index by the most since november while the extreme volatility and crypto and tech stocks has sparked worries over broader selloff up next may nonfarm payrolls report set to be released. Friday is likely to be the catalyst for the markets. Depending on the figure it could support stocks or changed perceptions of the economy's strength or coming stimulus measures following the employment number. We'll be watching the fed's latest comments about inflation at nfl. Whimsy meeting scheduled for mid june president biden unveiled his first budget before the weekend that detailed six trillion in spending for a fly twenty twenty two including two infrastructure proposals an increase in military resources as well as domestic programs like scientific research or new energy in total the plan would raise federal spending to eight point two trillion per year by twenty thirty one meaning annual deficits of over one point three trillion and one point eight trillion in twenty twenty two while the plan is only a blueprint for the administration's fiscal priorities and is subject to congressional debate. Other policy promises that were included in the budget may add to the weighty costs student loan forgiveness lowering the medicare eight to sixty creating a public health care option and reducing prescription drug prices. Bigger picture long gone are the days of austerity conversations. The tea party movement or the balanced budget talk. That made some political brownie points in fact the us has already returned to the record. Debt to gdp ratio last seat in the aftermath of world. War two one of the biggest fears among stock market investors if the spending will lead to a sustained rise in inflation which is hard to get rid of and would require the attention and possible. Intervention of the federal reserve in the economic textbooks of yesteryear big deficits were said to lead to price pressures at a possible overheating of the economy. However growing number of economists and the white house feel that the current circumstances call for different economic plan citing historically low borrowing costs and the need to get millions of americans back to work and guaranteeing that the nation remains competitive with china. The fed has also signalled it. Wouldn worries rates before twenty twenty four while investors are still eager to scoop up. Us government debt and treasury secretary. Janet yellen has argued that any risk of inflation and overheating could be controlled quote. The president's budget improves the long term fiscal outlook because his policies are more than paid for over the long run acting budget director. Chalan too young told reporters on friday failing to make these investments at a time of such low interest cost would be a historic opportunity. That would leave. Future generations worse off. How much is too much. There's no magic number or level for winnowed government's debt begins to hurt its economy as long as interest rates. Stay low in the. Us can borrow cheaply. the country can handle a much heavier debt load than was once thought possible however the federal debt cannot grow faster than the economy indefinitely once confidence a roads and treasuries the dollar reserve currency status is threatened borrowing could get more expensive and servicing. That debt would cancel any budgetary forecast that were made in the previous lending environment. The same scenario could happen if the us would also be forced to raise rates as inflation heats up or by borrowing beyond getting crowded out though we could still be a long way from that point despite all the doom and gloom the same scenario could happen if the us would be also forced to raise rates as inflation heats up or by private borrowing getting crowded out the we could still be a long way from that point despite all the doom and gloom employers can require their workers to get vaccinated against covid nineteen according to the latest update to the guidance issued by the us equal employment opportunity commission the mandatory vaccination requirement applies to all employees physically entering the workplace with only a few exceptions permitted under law. Such as a medical reasons. The workforce is unionized or taking it against sincerely held. Religious belief employers must also comply with the reasonable accommodation provision of the ada and title eight of the civil rights act of nineteen sixty four and other considerations. Better be used. Carrots companies can also offer incentives to workers vaccinated as long as the incentives are not coercive a move likely to open a floodgate of lawsuits. According to some experts. What is coercive is unclear because just as with everything else. One person's view of what is a coercive. Incentive is not the same as another person's said helen rela unemployment attorney at a new york-based law form the revised. Eeoc guidance was issued as the us cobra. Nineteen immunization drive reached a major milestone with more than fifty percent of the population. Getting at least one dose. Meanwhile the world health organization is renaming corona virus variants after the letters of the greek alphabet. Instead of the place of their first discovery the four types of providers known by the public as the uk south africa brazil and india variants have now been assigned the greek letters alpha beta gamma and delta other variants of interest will continue down the alphabet quote. No country should be stigmatized for detecting and reporting variants. Who appeared meteorologist. Maria van kerckhove declared to avoid this to simplify public communications who encourages national authorities media outlets and others to adopt these new labels married couples. China are now allowed to have up to three children. According to the communist party's politburo as the nation looks to mitigate risks to its long term economic prospects. The policy change will come with supportive measures. Which will be conducive to improving our country's population structure fulfilling the country strategy of actively coping with an ageing population and maintaining the advantage endowment of human resources for the state. Run news agency. The government is also set to gradually raise the national retirement age but did not provide further details bigger picture. They published several weeks. Ago showed china's population growth in spending at its slowest pace since the nineteen fifties with the numbers on mainland china increasing. Five point thirty eight percent to one point forty one billion. The working age population people aged fifteen to fifty nine was on the decline as well after hitting a twenty eleven peak of nine hundred twenty five million. While the fertility rate is only one point three children per woman during two thousand twenty missing target of one point eight that beijing had set in two thousand sixteen after replacing. Its one child policy. China's statistics agency took an unusual step by announcing that the population did grow in two thousand twenty but gave no total prompting some speculate. It was only an effort to pacify investors and corporations had issues. What are the world's second largest economy may already be an irreversible. Population declined before accumulating the household wealth of g seven nations while china has eased birth limits. Couples have been put off by the high cost of living especially in cities cramped housing many share apartments with their parents and career choices. Job discrimination faced by mothers childcare is also expensive. Maternity leave is short and most single mothers are excluded for medical insurance or social welfare. Payments investment angle consumer companies seem particularly gaining from less restrictive family planning policies. include hasbro. mattel. Danone nestle procter and gamble. Kimberly clark and reckitt benckiser asian communities such as kid focused good baby international japanese baby bottle producer pigeon core and diaper maker unit charm may also benefit disney is getting some further attention while carmakers that sell to the chinese market may get a boost. Saic volkswagen lyod meal x. Paying going jew automobile. Byu company great wall motor and brilliance china automotive as of six twenty pm today. Us futures golden crew all set to open in the green with bitcoin slightly down on today's economic calendar. The manufacturing index is out at ten. Am eastern time. If you enjoyed today's podcast. Please be sure to rate interview. It below your feedback is deeply appreciated. That concludes today's wall street breakfast. Thank you for listening for the best. Investment analysis and news on the web dot com. Subscribe to this. Podcast on apple podcasts. Google podcasts spotify. Stitcher you can sign up for our other podcasts. Behind the idea essay therapies. Let's hope cannabis investing podcasts and marketplace roundtable. Almost five phones as well a great day.