04-06-2016, 11:01 PM
The Organization of Petroleum Exporting Countries and other major oil producing countries can reach an agreement for a production freeze, even if Iran doesn’t join the action meant to help shore up prices, according to Kuwait’s OPEC governor.
Producers can reach oil output freeze without Iran, Kuwait says
Al-Naimi is probably right. Left alone, the market will balance demand and supply; that is what markets do. And if OPEC and Russia manage some kind of actual production freeze, that will happen faster. One way or another, though, the factors that have been sending oil prices down for the past two years are changing. Drawing on the work of my McKinsey colleagues, here are two possible scenarios:
Black swans and barrels: Thinking about oil | Scott Nyquist | LinkedIn
Including the first train from Gorgon, Australia's LNG export capacity currently stands at 6.2 Bcf/d. If the additional LNG capacity currently under development is fully operational as planned by 2019, the country's LNG export capacity would likely increase to the largest in the world, at 11.5 Bcf/d, equivalent of one-third of global LNG trade in 2014.... Gorgon LNG is the first of the four new projects off the northern coast of Western Australia to be partially commissioned. Three other projects in the northwest—Prelude, Wheatstone and Ichthys—are still under construction. These three projects have a combined capacity of 2.8 Bcf/d and are expected to come online in 2016-18. Most new Australian liquefaction capacity is contracted on a long-term basis to countries in the Asia Pacific region. Among destinations for Australian LNG, Japan accounts for the largest share of contracted liquefaction output, with contracts for 79% of output from the existing liquefaction projects (in operation prior to 2014) and 35% from the new projects. China is the second-largest destination, with 15% of contracted LNG from the existing liquefaction projects and 23% from the new projects. However, almost half of LNG contracted to China (about 1 Bcf/d) has flexibility in destination clauses. This flexibility allows buyers to take these volumes to countries other than China. In contrast, only 7% of LNG contracted to Japan (about 0.4 Bcf/d) is flexible and can be shipped to other countries. Almost 2 Bcf/d of the new Australian liquefaction capacity will be marketed on a spot basis.
Moody's oil and gas Liquidity Stress Index (LSI) hit a record high of 31.6% in March, up from 27.2% in February. The overall LSI rose to 10.3% from 9%.The LSI measures the percentage of issuers with Moody's lowest liquidity rating of SGL-4."The composite LSI’s rise is echoing the climb following the last major turn in the credit cycle that started in mid-2007 and ultimately led to an LSI peak of 20.8% in March 2009," says Moody's John Puchalla, and though this spike is mostly about energy, liquidity cracks are beginning to show outside of that sector.