RE:RE:Extremely Doubtful that Iran Will Freeze Production
"2 produce & sell less now & support a higher price over the long term."
not sure you understand what opec is up too jagsfan, they have never said anything about selling less. the saudis want a freeze on rising production, no cuts. and even if they do get an agreement it won't affect funtamentals for at least a year or so imho
here's the problem, they want a freeze because they are at close to max production, so were the russians last time but they tried to put the boots to iran who was ramping up, saudis have total disreagard for fellow opec members. this time iran is closer to max production so maybe they can agree to a ceiling, however, now you have nigeria and libya who are at the low end and ramping up and also iraq restarting kurdish production, sooooooo this time they put the boots to these guys. only way they get a deal is if all opec countries are close to max production which is probably another 2 mil bod when you add it all up. plus iran is iopening up to foreign investment in oil so i doubt they agree on a ceiling. mexico has recently opened up to foreign oil investment.
us shale producers were hedging like crazy when oil got back to 50 ish, they have cut costs tremendously. chinese buying for staorage is winding down. norway and canada are both increasing production. oil made it it's last good run when the saudis were beaking off and nigerian production was being sabotaged and canada was down 1 mil bod from wildfires.
barring a catastrophe somewhere I see maybe closer to 40ish at stella start up, that's just my guess, could be any where from 40-high 50's. maybe if we start out with cold winters it may get a boost, shoulder season almost here. one thing for sure as stated before, iae will trade with poo. will be interesting to see what happens with poo over the next few months but i certainly see way more negatives than pluses.
on the iae hedging stella i was thinking 20% or less of production so poo would still be the main driver. i think iae's hands are pretty much tied financialy until they get c/f from stella .
cheers ferret
ps unless opec decides to CUT and go back tobeing a swing producer I can't see any sustainable rise in poo for quite a while