News, Rumors and Opinions Tuesday 4-21-2020
TNT:
Tishwash: Expert reveals the repercussions of the collapse of the US crude price on Iraq
The expert in the oil sector, Furat Al-Moussawi, said on Monday that the collapse of the American oil price will affect Brent crude and the Iraqi economy, noting that he will lose 400 thousand barrels per day of his oil exports to America.
After a stormy trading session, the price of a barrel of oil for May delivery listed on the New York market fell below zero, for the first time in history with the end of trading, which means that investors are willing to pay to get rid of crude.
Due to the expiry of the May contract period on Tuesday, dealers had to find buyers as soon as possible.
But with storage facilities in the United States drastically full in recent weeks, dealers have been forced to pay people to find buyers, causing West Texas Intermediate crude price to reach $ 37.63 below zero, with trading ending.
Moussaoui expert told Shafak News, "The decline in West Texas oil prices was due to futures contracts and also large production outside the agreed upon, in addition to America's resort to the idea of storage, which was unsuccessful."
He added that "the equation of oil prices needs time to return, especially because of the spread of the Corona virus, which is the main reason for the closure of the economy and the lack of demand for oil."
Moussawi said, "This decline will affect temporarily Brent crude, not like West Texas," noting that "this crisis will end when the May contracts for oil futures contracts expire."
Mousawi added, "Iraq will lose 400 thousand barrels of oil exports destined for America due to the collapse of West Texas oil prices." link
Tishwash: The Secretariat of the House of Representatives informs its employees to resume work tomorrow
The Secretariat of the Council of Representatives has informed its employees of the resumption of working from tomorrow, Tuesday.
A source told the {Euphrates News}, that “the Secretariat of the House of Representatives informed its employees to resume the official working hours starting tomorrow, Tuesday.”
He added that the Secretariat of the House of Representatives “stressed the need to take the utmost safety and adhere to the directions of the Crisis Cell.”
The source indicated that “there will be an emphasis on employees in wearing masks and paws.”
The Supreme Committee for Health and National Safety decided yesterday that the curfew would be from seven in the evening until six in the morning starting tomorrow, Tuesday, until Friday, 5/22/2020, with the inclusion of the complete and complete ban on Friday and Saturday of every week, with the same exceptions and procedures The former, and the continuation of the previously excluded groups, including furnaces and pharmacies.
The new decisions included the resumption of government institutions at a rate of 25%, but they kept continuing to close schools and universities, places of worship, cafes, sports stadiums, malls and wedding halls and prevent the establishment of Al-Fatiha councils, solace and gatherings. link
********************
Harambe: Reuters: Oil slump wreaks havoc in Gulf markets, Saudi riyal under pressure
(4/21/20)
DUBAI/LONDON (Reuters) - Gulf debt and equity markets fell on Tuesday and the Saudi currency dropped in the forward market, after U.S. crude oil futures collapsed below $0 on a coronavirus-induced supply glut.
The plunging oil prices, combined with other economic pressures caused by the coronavirus outbreak, are hurting the budgets of Gulf countries that rely heavily on crude exports and their currencies are also under pressure.
“Despite the OPEC deal to cut over 10% of global oil production, the price of oil keeps falling,” said Artur Baluszynski, head of research at investment management firm Henderson Rowe. “While yesterday’s negative WTI futures price might have been a one-off glitch, it does confirm there is trouble ahead.”
U.S. crude oil futures (WTI) fell below $0 on Monday for the first time in history as demand cratered. Brent crude, the international benchmark, also slumped, though that contract was nowhere near as weak. [O/R]
Mohammed Ali Yasin, chief strategy officer at Al Dhabi Capital in Abu Dhabi, said most of the market turmoil was sentiment-based.
“People are not understanding why this happened so fast ... Is this (the price) at which governments have to sell oil? The answer is no, but it will take them some time to understand.”
The Saudi stock index .TASI dropped 1.5% at the market open with oil company Aramco (2222.SE) down 1.7%.
Shares in the Dubai market .DFMGI fell 1.4% while the Abu Dhabi index .ADI lost 0.5% and the Kuwaiti premier index .BKP declined 2%.
The cost of insuring against a potential debt default by Saudi Arabia — the world’s biggest oil exporter — increased slightly, to 168 basis points from 166 on Monday, according to data from IHS Markit. It is up 13 bps in the past week.
Meanwhile U.S. dollar-denominated bonds issued by Saudi Arabia, Oman, and Bahrain shed between 0.5 cents and 2 cents while Aramco’s paper due in 2049 was down almost 1 cent, according to Refinitiv data.
DOLLAR PEGS UNDER PRESSURE?
The Saudi riyal fell in the forward market against the dollar. It is pegged at 3.75 to the U.S. currency in the spot market, so banks often use the forward market to hedge against risks.
Nine-month dollar/riyal forwards SAR9M= — trades scheduled to take place in nine months — went as high at 148 points, up from Friday’s close of 60 points — their highest level since November 2017. Refinitiv data showed them last at 110 points.
One-year forwards SAR1Y= rose to 210 points, flirting with a near 2-1/2 year high of 211 hit on Monday.
“The collapse in oil prices has led to renewed pressure on dollar pegs in the Gulf,” said Jason Tuvey, senior emerging markets economist at Capital Economics.
But besides the Saudi riyal, other currencies did not move much on Tuesday.
“People will get excited about and go long dollars but not because they think the pegs are really going to break but because there will be some others betting on it,” said Paul McNamara, investment director at GAM.
“It is one of those things that you might see until people become bored of it again.”
Courtesy of Dinar Guru
Footforward Wow...Black monday? Referring to oil. [I'm no expert at all, but are we witnessing a flash crash?] I don't know for sure, but either way this puts pressure on Iraq.
Jeff ...from the ISX website they're clearly telling us they have full intentions of resuming the ISX as of Sunday April 26th...they shut down the financial markets around 3-17. No one can deny or argue that the rate change process started. It's blatantly obvious...why is this taking so long? Everybody just thinks it's a 'magical just change of a rate' and done...the reason this whole thing is taking six weeks is because they have multiple step that they have to complete to get the rate changed.
*************
Keiser Report | When Plunder Becomes a Way of Life | E1530
Apr 21, 2020
In this episode of Keiser Report, Max and Stacy look at how the ‘fiat moral code’ has justified immorality in financial markets and the monetary system around us.
In the second half, Max interviews Will Reeves about the future of bitcoin markets after the halving and the case for individual sovereignty in an age of money printing.