Since the time, it is no longer believed. However, the members of Opec are finally able to reach agreement on the principle of a drop of 750,000 barrels per day of oil production . A surprise to both the agreement between Iran and saudi Arabia seemed to be difficult, if not impossible, to achieve. The objective is to support oil prices in a context of global economic growth which remains weak. Two days ago, the world trade Organization (WTO) has been particularly pessimistic on Tuesday about the dynamism of global trade , warning that the growth of commerce on the planet in 2016 should be “ the more slowly since the financial crisis “. The WTO does not anticipate more than a growth of 1.7% in world trade compared with 2.8% previously. A risk for the record price of oil, that comes to attenuate the agreement reached in Algiers. The announcement has pushed the barrel of Brent of 5,92 % Wednesday night barrel that stabilizes this Thursday morning around 48,40 dollars.
The Total share increased by nearly 5%
This agreement, considered it still unlikely the day before, promotes the continuation of the rebound values of the oil are severely affected in 2015. The Stoxx Europe 600 Oil & Gas bouncing from 4.5%, bringing its gain since the beginning of the year to 8,20%. The oil giants are facing in Europe : the Norwegian Statoil takes 5,27%, Royal Dutch Shell 5,17%, Total of 4.95%, ENI 4,21% and BP was 4.15%. The values for oil services, especially to breathe. Vallourec bounces 9,36 %, Saipem 6.53%, CGG between 8.88 % and Technip of 6,66%. The sector groups have been hard hit by the sharp reduction in investment from energy groups. Recently, the brazilian Petrobras announced that it would cut 25% of its investments planned between 2017 and 2021.
More generally, the agreement signed in Algiers allows you to remove the risk of a relapse brutal in the price of oil in coming months, reducing the pressure on some producers who had been bled white financially, particularly in the shale gas in the United States. The S&P 500 Oil & Gas Exploration and production has soared on Wednesday evening of 6,12% on Wall Street. Among them, Murphy Oil, very sensitive to oil prices, has rebounded to 11,28%, while Chesapeake is in financial difficulty and dropped recently by activist Carl Icahn, has taken 8,35%.
The currency oil relieved
On the other hand, the announcement of a next decrease of oil production by Opec leads to clearances in the aviation sector. Air France lost 2.35 per cent, the largest decrease of the SBF 120, while Luftansha declines of 2.67% and Easyjet 1.55%.
Finally, it is also a deliverance for the currencies of oil-producing countries. The canadian dollar resumed Thursday morning 0,96% against the us dollar, the brazilian real 0,91%, the ruble 0.89 per cent and the mexican peso 0,45%. The currency of Angola bounces also of 1.86% The fall in the price of oil in 2014-2015 was put under pressure those currencies, forcing the central banks of these countries, that is, to let go of their currency (Russia, Brazil, Colombia…), or dump a portion of their foreign exchange reserves to protect their parity exchange rate, before needing to often devalue sharply at the image of Kazakhstan or Nigeria.
Goldman Sachs skeptical in the medium term
now the question is if the oil has the ability to really go up in the short term. For the moment, a barrel of Brent is far from the level of the summer of 2014, while the increase on Wednesday has for the moment reduced to its highest since September 12,… Goldman Sachs believes however that the agreement with the Opec could swell the course of 7 to 10 dollars per barrel in the first half of 2017, with an accuracy, if it is implemented… Because, in the longer term, the bank remains ” skeptical about the quotas that are proposed, if they are ratified “. In the past, the Opec countries, have rarely met their production quotas . In addition, Goldman Sachs also expects a ” to ensure that this proposal of reduction is counter-productive in the medium term with a broad resumption of drilling around the world “. This could negate the objective of reduction in production of oil in the world.
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