Read? Coronavirus: US oil price plunges to 21-year low
A key benchmark of US oil prices plunged to a 21-year low on Monday, amid continued fears about oversupply in the market.
US West Texas Intermediate crude futures (CL=F) dropped over 18% to a low of $14.45 a barrel on Monday morning, a level not seen since 1999. By 8.20am UK time, US crude futures were still down 17.9% to $15.00.
Brent oil futures (BZ=F), the international benchmark, were more resilient. Brent was down just 2.2% to $27.46 per barrel at the same.
“The steep fall in the price is because of the lack of sufficient demand and lack of storage place, given the fact that the production cut has failed to address the supply glut,” said Naeem Aslam, chief market analyst at Avatrade.
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Uncle8888,
ReplyDeleteBig boys with strong balance sheets & easy access to bank credit will be able to survive major recessions.
Even better if management can pivot to growing areas. But need good mgmt else end up like Singpost or SPH :P
Companies, especially SME's, with weak financials on the other hand...
Collapse of SME's tend to be a lagging indicator though ... they'll still be failing in high numbers even after the major bottom is in in the stock markets.
Singapore banks to lower lending rates to 2-3% for SMEs under latest MAS facility
DeleteCan SME survive with such borrowing rate?
Oil crash in the states...
ReplyDeleteMay futures for US crude oil is cheaper than water LOL
Shiok for those countries doing oil stockpiling!
DeleteTime for you to go to Bedok beach to watch the same again in 2020
Delete(Bloomberg) -- A narrow waterway off Singapore has become even more congested as oil-laden tankers wait out a slump in global fuel consumption that’s crimped demand and boosted the use of ships to store cargoes.
About 60 clean fuel tankers are currently anchored along the busy strait, up from the usual 30-40 ships, according to Rahul Kapoor, head of commodity analytics and research at IHS Markit. Some vessels are being used to hoard fuel at sea as onshore tanks fill up. Others are probably parked, waiting to be redirected to any willing buyer across Asia and the world as the coronavirus pummels economies worldwide.
Ships filled with gasoline to jet fuel are moving from major refinery hubs such as South Korea and China due to a crash in domestic demand and swelling stockpiles. These tankers are finding their way to the Singapore Strait, where the glut is being compounded by offloading delays at the city state. Vessels currently have to wait about two weeks to discharge cargoes in Singapore, compared to the typical 4-5 days, according to shipbrokers and traders, leaving ships stranded in local waters.
Storage options are dwindling globally as onshore tanks rapidly fill to capacity, prompting traders, refiners and infrastructure companies to seek alternatives such as pipelines and ships. Bloomberg earlier reported that those who managed to snag some highly-coveted tanks in Singapore were being charged much higher rates, even as the nation stopped leasing out space to new customers.
Wealth in the market can just disappear in weeks!
ReplyDeleteBranson, who Forbes estimates has a net worth of $4.4 billion, said his wealth was calculated on the value of Virgin businesses before the crisis, “not sitting as cash in a bank account ready to withdraw.” He said his personal wealth and cash held by the Virgin Group was now being invested in back into its companies.
Branson also said he would be raising money against Necker Island — his private island — and other assets in an effort to save jobs.
Today, Mr Market's price action seen to confirm that Kep is no longer an oily stock.
ReplyDelete