Member Info for hey_arnold

counter-productive measures, such a US export ban.
A US export ban would significantly disrupt the US and global oil markets, and
npotentially be a counterproductive tool to attempt to lower oil prices. The US exports 3 mb/d of crude and domestic pipelines would not be able to reroute these volumes to US refiners, which further don’t have enough capacity to process this much crude. This would leave excess US crude supply quickly reaching tank tops and forcing shut-in production, with investment and production soon to enter significant declines. At the same time, the global market would be deprived of 3 mb/d of US supply (light sweet crude that is Brent like in quality). Brent prices would therefore need to spike to push demand lower as there is simply not enough spare capacity (nor suitable crude) to replace US lost exports. Finally, with the US an importer of gasoline from Europe, US gasoline prices would spike to curtail domestic demand, creating a negative hit to US economic activity.

Taking a step back, while the coordinated government stock releases would
nwarrant a $2/bbl downgrade to our year-end Brent price forecast, we see offsetting risks from the lack of progress on negotiations with Iran. The restart of negotiations next Monday, November 29, will provide some sense of potential timeline to an agreement, with clear risks that our assumption for an April lift of sanctions (and February onward unwind of 60mb Iranian floating storage) could prove too optimistic. In addition, OPEC could consider halting its production hikes to offset the detrimental SPR impact of lower oil prices on the needed recovery in global oil capex, likely justifying such action as prudent in the face of COVID demand risks.
In conclusion, we reiterate our view that such government intervention is not the
nsolution to higher oil prices that are required to overcome the slow supply response of producers. This instead has been driven by (1) the damage to investors caused by oil producers’ capital destruction over the last seven years, now compounded by ESG allocation inefficiencies, and (2) the demand uncertainties of COVID, China and energy transition. Neither of which will likely be resolved by palliative measures such as an SPR release, or potentially

Details of government crude reserve releases started being released today,
nNovember 23, with 50 million barrels (mb) from the US with as much as 30 mb from Korea, Japan, China, India and the UK. The aggregate size of the release of c. 70-80 mb was both smaller than the 100+ mb the market had been pricing in, with the swap nature of most of these barrels implying an even smaller c. 40 mb net increase in oil supplies over 2022-23. That is in the context of a market drawing up to 2mb/d at present.
On our pricing model, such a release would be worth less than $2/bbl,
nsignificantly less than the $8/bbl sell-off that occurred since late October. At $82/bbl currently, Brent prices are in fact not only pricing in today’s announced release, but an additional hit to global oil demand of 1.5 mb/d for the next three months. That is equivalent to pricing in both a repeat of last winter’s 1 mb/d hit to EU oil demand due to the COVID wave (which occurred in the absence of vaccinations) as well as a repeat of this summer’s 0.5 mb/d hit to Chinese demand from lockdowns. We view these as likely excessive concerns over the next three months, leaving the recent sell-off overshooting fundamentals due to the year-end decline in trading activity.

Also, what are the near term catalysts I should look into? thanks

What level is TLW hedged at for 2022 and what price please? Also, what price are current hedges for 2021?

The reserves appear to be a short term plaster over a structural tightness. I dont think the market expects and increase by opec +

IMO Its a pretty bad sign when the market rallys off the back of the Powell announcement and this does nothing.

(Powell to stay on). Bid on!

Market likes the biden news.

But dont worry its just as protection for my long.

Vs long BWNG.

Yes

My target is 2200p to close.

Re supply chain. ASOS has more exposure to China vs Boohoo etc. Hence company specific news in press. Whole sector is under pressure though.

This continues to look like a sell short term with no near term catalyst to support prices. I expect to see further rotation out of this sector.

Online retailers are under pressure. Turned my long here in to a relative value trade last week vs ASOS.

Despite sales rising costs are rising faster and this is the issue with retailers. The margin story continues to play out. Im happy to continue to remain short hear to protect my position in BWNG.

Aiming to take profit at 2200p.

Also, today isn't profit taking.

Dont you think investors know christmas is coming up and have already price the increased demand? Doesn't sound a strong reason to buy to me.