Energy Report: Restraint

The crude oil market is breaking out and commodities are hot! and they the place to be in 2021. Oil prices are the highest since March on reports that OPEC plus will show restraint and not increase oil output like the market was expecting. We are also getting strong overall commodity sentiment as funds look to get long and rebalance. Yet it appears that OPEC plus is recognizing the fact of more covid lockdowns and that perhaps it is not the time to be raising production just yet. The OPEC Secretary-General Mohammad Barkindo on Sunday warned about the downside risk for the oil outlook in the first half of 2021 and it appears the members might heed that warning. In recent weeks Russia has suggested that they wanted to raise production by 500.000 barrels a day in February but now the market is pricing in the fact that that may not happen. 

Pump Jack, Oilfield, Oil, Fuel, Industry, Petroleum

Image Source: Pixabay

Oil is also getting support from geopolitical threats. Bloomberg News reported that “The USS Nimitz will remain in the waters in and around the Arabian Sea, U.S. Acting Secretary of Defense Chris Miller says in a statement, following what he said were recent threats from Iranian leaders against President Donald Trump and other U.S. officials.”

How is that socialist thing going for you? Reuters reported that Venezuela’s oil exports hit the lowest level since the 1940s falling by 376,500 barrels per day (bpd) in 2020, according to Refinitiv Eikon data and internal documents from state-run PDVSA, financially squeezing socialist President Nicolas Maduro. U.S. sanctions along with Venezuelan corruption are killing the once-great oil company.

Venezuela is now going to go all out on cryptocurrency. Bloomberg reports that Venezuela’s government is planning to move to a fully digital economy as hyperinflation has made worthless bolivar notes practically disappear, and dollarization expands through the local financial system. The U.S. dollar has operated as an escape valve for Venezuela amid U.S. sanctions and collapsing oil revenues, President Nicolas Maduro said in a televised interview with Telesur on Friday. He said 18.6% of all commercial transactions are in dollars, while 77.3% are carried out in bolivars with debit cards. Only 3.4% are paid with bolivar notes. “They have a war against our physical currency. We are moving this year to a more profound digital economy, in expansion. I’ve set the goal of an economy that’s 100% digital,” Maduro said, adding that physical money will eventually disappear.

1 2
View single page >> |

Disclaimer: Make sure you prosper all week. Stay tuned to the Fox Business Network where you get the Power to Prosper. Trade updates and levels. Call me at 888-264-5665 or email me at  more

How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.