Category Archives: Economy

OPEC agrees for Production Cut

OPEC members have agreed to cut crude oil production. This is the first such agreement since 2008 and it will help narrow the demand-supply gap faster than expected. OPEC has decided to cut production by 1.2 million barrels per day to bring their production down to 32.5 million.  For the first time in 15 years, Russia has agreed to participate in cutting production and has announced a cut of 300,000 barrels per day. The International Energy Agency (IEA) had warned that oil stockpiles, which are already at record levels, would expand for a third consecutive year in 2017 unless OPEC cut production. As per the IEA’s estimates, they were at 300 million barrels of oil, enough to fill 150 supertankers. Most of the oil inventory is presently stored in these floating supertankers. The OPEC cut is also positive for US oil & gas producers as we may have $50 as a near-term floor for crude oil prices.

Donald Trump is now President USA

Donald Trump has won the election is a fairly clear way, but it was a close election with nearly same 48% of nationwide votes for each candidate, but the way electoral seats are setup in USA, Trump won with a wide margin over Hillary Clinton, who could not galvanize people in the same way Trump did on his side.

Donald Trump is now 45th President of USA.

It is clear that people have voted for change at any cost.  Its the same theme as in Brexit in the UK, where majority of people outside London and in interior counties voted for Brexit and change of status quo irrespective of economic impact.

Trump has sold hope to millions of people across America, especially to those people who are struggling, and we can only hope that some of those hopes sold during election speeches come true.



100 Energy companies filed for Bankruptcy

About 100 North American oil and gas companies have filed for bankruptcy since the start of a 2 year crude oil price collapse, and the industry may be only halfway done, according to restructuring specialists. Despite OPEC’s oil deal, “there’s going to have to be more filings just because there’s no price out there that’s foreseeable that’s going to bail these companies out,” said Patrick Hughes, partner at Haynes and Boone.

Here’s an article on how the Quantitative Easing by US Fed has contributed towards reduction in crude oil prices, which is a good thing for US economy.