Posted on 03/13/2020 8:17:07 PM PDT by texas booster
Leading Russian firms saw their share prices collapse Monday, as the fallout from Moscow rejecting an oil production pact with Saudi Arabia rocks global financial markets.
Among the biggest losers were state-backed lenders Sberbank and VTB, which both plunged by more than 20% when European markets opened.
Oil major Rosneft, also state-owned, recorded a 20% drop — equivalent to a $15 billion fall in value — while Gazprom shares crashed by almost 25% initially, before recovering slightly to stand 15% down.
Markets in Russia are closed Monday for a public holiday, but shares in a number of Russian companies are also traded on the London Stock Exchange — giving an idea of the impact the market chaos is already inflicting on the Russian corporate world.
Rosneft had been a vocal opponent of further oil production cuts proposed by Saudi Arabia, which Riyadh sought in order to increase prices. The company, headed up by Igor Sechin, a close ally of President Vladimir Putin, publicly backed Russia’s rejection of a new deal, instead saying a period of lower prices would hurt Rosneft’s rivals in the U.S. shale industry.
Saudi Arabia responded to Russia’s rejection by pledging to flood the market with excess supply and cut prices for key customers, provoking an “oil price war”, and sending prices for benchmark Brent crude tumbling by more than 30% to $33 a barrel. As a knock-on effect, the Russian ruble also lost 8%, falling to a four-year low against the U.S. dollar...
(Excerpt) Read more at thebarentsobserver.com ...
It was only slightly related to the CV scare a week ago.
Nice.
MBS is winning. But he may be creating a problem for himself at home.
Well, there were some drops last week.
Which is why MbS may have started the fight, since Russia is continually meddling in Saudi affairs, and supporting long time Saudi enemies.
Add in a proposed pipeline through Syria that is blocked, and MbS has his reason to start the oil war.
Saudi's may pull it out of the ground cheaper, but they have every dollar accounted for up $84/a barrel.
If it stays lower than that for very long, MBS may have to answer to a lot of angry cousins.
I think Trump’s plan to buy our oil for the SOR (which Obama gave away) may have some influence,
"I mean, you, you take your average Russkie, we all know how much guts he's got. Hell, look, look at all them them Nazis killed off and they still wouldn't quit!"
A classic example of the Russian mind. Putin wants to punish the US fracking industry by letting the price of oil plunge and he doesn’t care that it punishes his own people even more.
What he didn’t expect is that President Trump would subsidize our energy companies with a $75B purchase for the Strategic Oil Reserve. Why not “fill up” when the price is cheap. Thanks Vlad!
This story is from a week ago.
What’s up now?
Russian Ruble value collapses. Now written as “Russian Ruble in Rubble due to its collapse”.
You average Ruskie talks big but is short of know how, you can’t expect an ignorant peon to understand.
My favorite movie.
Unmentioned and unnoted is what has happened in Iran as a result of the crude increase. A 30% drop to Iranian revenues from an extremely reduced crude volume sales could be devastating to the Iranian economy
Then we hear of serious Virus related problems in Iran. Virus coupled with loss of crude revenue could be the camel’s back breaking straw
While Russia might be experiencing some pain, the 30% price drop could kill Iran
The silver lining to this trouble is that it could destroy the Russian economy. Oil is their only source of outside income. They were stupid and greedy to not agree to the deal. Too bad Vlad.
One reason to post now is to remind everyone that SARS-COV19-2 isn't the only reason for our markets getting churned.
It looks like the SPR is at 635 MMB and that capacity is 719 MMB. Oil at $35 a barrel is a good reason to top it off.
A link to the story about President Donald J Trump ordering the SPR to buy up crude at these low prices.
Great news that Trump’s strategy is really hurting Iran!!
I don’t get the connection of the SOR to Obama . . . I do dimly recall that he sold some of it, at the time I thought was a risk.Trump’s refilling the SOR at a bargain price is an interesting move . . . the SOR puts the government in position to be a player any time anyone tries to make the price shock upward. The fact that it’s empty now is sort of convenient for Trump to help American oil producers.
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