According to Bloomberg (non pay walled):
Saudi Arabia cut oil prices for buyers in Asia as coronavirus lockdowns in China weigh on demand, countering uncertainty around Russia’s supplies as the Ukraine war drags on.
Saudi Aramco is lowering prices for the first time in four months. The state-controlled company dropped its key Arab Light crude grade for next month’s shipments to Asia to $4.40 a barrel above the benchmark it uses, from $9.35 in May. That’s in line with a Bloomberg survey of refiners and traders from late April that forecast a $5 decrease.
I've invested a lot in oil stocks (Coterra, Pioneer, Devon especially). So I was wondering:
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Many analysts still say this is just a small blip on our way to a long “super cycle” of sustained high oil prices. Do you agree?
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Why did Saudi Arabia decides to make this huge cut (from $9.35 to $4)? Is this good for tech stock in general? Does it signal good news — oil prices coming down maybe Fed will slow down? Or is it bad news — China recession is terrible and it has spooked the Saudis.
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Is this just the beginning of the flood? i.e. other oil producers around the world start to break pricing discipline?
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