Maintain Economy ― who better to negotiate? With the sheikhs or the fed?
While oil prices did not manage to fall heavily again, and investors are encouraged by the upcoming meeting of producers, which will be held March 20, will try to figure out what we can expect from her for this appointment. About it says in the program «Replica» economic analyst Alexei Bobrovsky.
Investors are waiting for the March meeting of the countries-manufacturers of oil. But will it bring the relief the market? What to expect from the key players? And why again from break so much depends?
First, again, there was talk and where to meet? Come to Doha, they say the guys from cartel, I want to say: no, it is better you to us… If it all had some meaning!
In prospects of reaching agreements believe with great difficulty: while it is possible, but how long everyone will stick to commitments? This is the number one issue! By the way, the meeting of our President with the oil, obviously, was about this. Within a month, said energy Minister Alexander Novak, the decision will be made, i.e. if you agree with the sheikhs.
Secondly, it is noteworthy that the meeting, if held, will be held after meetings of the fed and the ECB, i.e. understand in the member countries of OPEC, or don’t understand, but it turns out competently. First, will determine the future of the market, at least until the fall, Ms. Yellen and Mr. Draghi and his comrades, and then the oilers. For today, say it again, the main factor for oil is not the presence of oversupply in the market, and the incentives the fed: once stood «the printing press» — oil and fell! Which confirms the theory that to a large extent the oil has become a financial instrument.
The second factor is an oversupply in the market, i.e. a serious excess of supply over demand. He, of course, important, but still secondary.
A couple of years ago over the same period was 2 million barrel per day. Today only a little over a million, but that, coupled with the first problem, enough investors in the market did not believe in its rapid growth. But again: this is not the main factor! But it is psychological, because the market is the place to be a classic price war. Fighting all with all: US — the Saudis — the Iranians and Russia. All dumping, all fighting for the remaining demand in the market, which is mainly there in Southeast Asia.
In a sense, it all started with the Americans, after they launched their shale projects. They pulled from the market the Saudis, and those, in order not to lose share, began to fight with lanceville, and fight for the Chinese market through dumping. Iran, post-sanctions, just trying to take your.
Because the answer to the question, what will OPEC agreed in March with all the other manufacturers, simple, but consists of several positions. Iran will get and beyond to make up for lost time, and he does not hide it. It is likely that Russia, the Saudis and other sheikhs will shake hands, leaving the issue of Iran out of the equation. But we will comply with the obligations from time to time. While prices do not rise. And if not will be higher, and then to talk about increasing production loud is not necessary.
The same I think, by the way, in Saudi Arabia… it is Easy to assume that the share of the market they do not intend to lose while for some a short time not just to expand production they can afford, and then, if prices do not rise, the extra hard-to-recover oil will leave the market, which will contribute to its balancing… And let slightly, but prices will rise.
But most importantly: is there a choice for the fed? To raise rates now is insane. Considered, the March meeting will determine the future of the financial system of the USA and the world until the fall for sure. But if Ms. Yellen to lead the fed — say something nice to the investors, and the best will do, by the way, reasons to expect that many, colleagues from OPEC to do nothing and not have to.
It is clear that the American kancevica also need cheap money… In General, everyone needs incentives from the fed… and verbal interventions and the non-proliferation of production — albeit briefly — from oilers.
What else to expect?