This item is part of Stockwatch's value added news feed and is only available to Stockwatch subscribers.
Here is a sample of this item:
by Stockwatch Business Reporter
West Texas Intermediate crude for April delivery added $3.23 to $34.36 on the New York Merc, while Brent for May added $2.86 to $37.22 (all figures in this para U.S.). Both benchmarks regained about one-third of the ground they lost yesterday after Saudi Arabia and Russia launched an oil price war, triggering the biggest one-day rout in oil prices since 1991. Today they staged a weak rally on optimism that the two countries will come back to the table and take steps to stabilize oil markets. Here in Canada, Western Canadian Select traded at a discount of $13.58 to WTI, up from a discount of $13.77. Natural gas for April shot up 16 cents to $1.94. The TSX energy index added a mere 1.25 points (compared with yesterday's loss of 27.76 points) to close at 75.45.
U.S.-focused shale producer Ovintiv Inc. (OVV) added $1.12 to $4.07 on 14.5 million shares, regaining a bit of ground after its harrowing $7.73 plunge yesterday. This was one of the sector's most bruising collapses. The Saudi-Russian price war has hurt producers worldwide, but if there is one thing both countries can agree on, it is that the U.S. shale industry would be a particularly desirable casualty. OPEC has been openly trying to undermine U.S. shale since 2014. Its efforts backfired when U.S. producers proved more resilient than expected, so in 2016, Saudi Arabia changed course and enlisted the support of Russia and other countries to create what was informally known as OPEC+ -- which the United States was never a part of -- to bolster global oil prices. The theory was that higher prices would benefit everyone. In practice, Russia was ambivalent from the start, reluctant to cede revenue and market share to American companies that (in its view) would likely just go bankrupt if the market were left alone. Russia eventually came to resent the way that the sacrifices of OPEC+ seemed to prop up U.S. shale at everyone else's expense. Now, the Saudi-Russia rivalry has bubbled over into a price-sapping war of attrition.
The remainder is available to Stockwatch subscribers.
© 2020 Canjex Publishing Ltd. All rights reserved.