Crude oil prices rallied to $70.43 last week Friday, ending the week bullish for the first time since November 2018. This means Brent closed last week 2.9% higher. Meanwhile, oil prices maintained its bullish run yesterday, as it closed at $70.76 a barrel.
Brent oil prices rose, as expectations of tight global supply outweighed pressure from rising U.S. production and less robust global demand indicators.
Similarly, U.S. West Texas Intermediate (WTI) crude settled 98 cents higher at $63.11 a barrel on Friday, rising 1.6% to a new five-month closing high. WTI posted its fifth consecutive weekly gain, rising 4.9% over 5 days.
Both contracts hit new five-month highs
Oil prices are rallying in reaction to the U.S. employment report. According to John Kilduff, a partner at Again Capital LLC in New York:
“Signs of global economic slowdown had been a headwind for oil prices, but this morning’s report seemed to dispel at least some of those concerns.”
Meanwhile, Crude futures received a boost from news of a potential slowdown in crude production out of Venezuela, as U.S. sanctions and energy blackouts hit the OPEC nation’s oil industry.
Over-delivering Saudi Arabia is OPEC’s Bull
The combined production of all 14 OPEC members reportedly stood at 30.4 million bpd last month, down by 280,000 bpd compared to February and the lowest level of OPEC production since February 2015.
However, Saudi Arabia’s production cut has pushed down OPEC’s crude oil production by 570,000 bpd from February to 30.23 million bpd in March. According to the monthly report of S&P Global Platts survey, OPEC’s current production represents the lowest production in more than four years.
OPEC’s de facto leader and biggest producer, Saudi Arabia, reportedly cut its crude oil production in March to the lowest level since February 2017. The Country delivered on its promise to cut more than pledged in the pact and slashed output by another 280,000 bpd last month, with March production at 9.87 million bpd.
The U.S ‘NOPEC bill’ – Saudi Arabia threatens to ditch dollar oil trades
Saudi Arabia is reportedly threatening to sell its oil in currencies other than the dollar if Washington passes a bill exposing OPEC members to U.S. antitrust lawsuits.
The No Oil Producing and Exporting Cartels (NOPEC) which was first introduced in 2000, is a U.S. Congressional bill aimed at removing the state immunity shield. By extension, allowing OPEC and its national oil companies to be sued under U.S. antitrust law for anti-competitive attempts to limit the world’s supply of oil and the consequent impact on oil prices.
Report has rightly indicated that the chances of the NOPEC bill coming into force are slim and Saudi Arabia would be unlikely to follow through. Sources within the Saudi’s oil industry reportedly disclosed:
“let the Americans pass NOPEC and it would be the U.S. economy that would fall apart. The Saudis know they have the dollar as the nuclear option.”
Trump’s factor and U.S trade influence
The NOPEC bill has gained momentum since President Trump came into office. Prior to Trump’s election into office, he reportedly backed NOPEC in a book published in 2011. However, despite Trump’s continued tirade against OPEC, he has not yet voiced support for NOPEC as president.
On the contrary, while global trade has been advocating for moves to diversify trade from the dollar, economic superpowers are equalling plotting moves to dilute U.S influence over the world economy. Hence, it would resonate well with oil giant like Russia and consumers such as China and the European Union (EU) if Saudi’s move to ditch dollar sail through.
Saud Arabia’s influence and its Oil firm “Aramco”
Saudi Arabia reportedly controls a 10th of global oil production, roughly on par with its main rivals – the United States and Russia. Its oil firm Saudi Aramco holds the crown of the world’s biggest oil exporter with sales of $356 billion.
Recently, it was reported that Saudi Arabian national petroleum and natural gas company, Saudi Aramco, recorded $111.1 billion in profit for FY 2018 as the world’s most profitable company.
Prices to rise as Venezuela’s Blackout lingers alongside Iraq Production Cut
An earlier report has shown that OPEC’s oil production in March 2019 fell to its lowest level since February 2015, as Saudi Arabia cut more than it had pledged. Also, Venezuela continued to struggle amid U.S sanctions and a major blackout.
The power blackouts currently witnessed by Venezuela has crippled its oil industry and exports. The country reportedly saw its production drop to a 16-year-low, at 740,000 bpd.
Also, OPEC’s second-biggest producer Iraq, cut its production by 100,000 bpd, making its production reduced to 4.57 million bdb in March. This, however, was still slightly above Iraq’s 4.512 million bpd production cap under the deal.
Twitter CEO auctions his first-ever tweet on Twitter, bidding at $2.5 million
Jack Dorsey is auctioning his first-ever tweet on a website that sells tweets as non-fungible tokens.
Twitter CEO, Jack Dorsey is auctioning his first-ever tweet on Twitter “just setting up my twttr” on a website that sells tweets as non-fungible tokens (NFTs).
The tweet was listed for sale on ‘Valuables by Cent’ – a tweets marketplace that was launched three months ago. The tweet was first made in March 2006
The tweet received offers as high as $88,888.88 within minutes of Jack tweeting a link to the listing on” Valuables by Cent” on Friday.
Currently, bidding has reached $2.5 million (€2.1 million) indicating the potential in selling virtual objects that have been authenticated through blockchain technology.
The highest bid for the tweet — $2.5 million — came from Bridge Oracle CEO Sina Estavi. It topped cryptocurrency pioneer, Justin Sun’s $2 million bid.
The final buyer of the tweet will receive a certificate, digitally signed and verified by Jack Dorsey, as well as the metadata of the original tweet. The data will include information such as the time the tweet was posted and its text contents. Most of this information, however, is already publicly available.
According to Valuables by Cent’s terms, 95% of a tweet’s sale will go to the original creator while the remainder will go to the website.
What you should know
- NFTs is a unique digital certificate that states who owns a photo, video, or other forms of online media.
- Dorsey’s 15-year-old tweet is one of the most famous tweets ever on the platform.
- Bidding had reached $2.5 million (€2.1 million) on Saturday, indicating the potential in selling virtual objects that have been authenticated through blockchain technology.
- More people are currently bidding their tweets on the platform.
Bamboo’s current rate for buying U.S Stocks weakens to N492/$1
Bamboo is currently offering its users a premium of more than 20% compared to the official exchange rate.
The fast-rising Nigerian stock broking application, Bamboo, is currently offering an exchange rate of N492 to the dollar.
About two weeks ago, the Nigerian stock trading app offered an exchange rate of about N484 to $1.
The green-colored trading app known for allowing local-based Nigerians to invest in stocks listed on the world’s biggest stock market (New York Stock Exchange and NASDAQ) is currently offering its users a premium of more than 20% compared to the official exchange rate set by the Nigerian apex bank.
That being said, Nairametrics’s most recent research observed Chaka. ng offers the lowest exchange rate charge of N480 to 1$, other Nigerian-based stock trading apps that include Throve and Risevest currently offer their clients N491.68 and N486 to $1 respectively.
In addition, other leading fintech platforms reviewed by Nairametrics also presently offer exuberant rates as high as about N519 to a dollar, thereby adding more transaction costs on a significant number of Nigerians hoping to trade such financial assets.
A growing number of Nigerians are currently increasing their exposure to the U.S stock market taking to the current bearish trend that is being witnessed in the Nigerian Equity market and growing urge in hedging against the weakening local currency.
Consequently, a lot of Nigerians are flocking the New York Stock Exchange (NYSE) on the account it has about 2,800 companies listed, while the NASDAQ has about 3,300 stocks listed. This gives Nigerian investors numerous options where they can invest their money. It is also why the US economy attracts billions of dollars in portfolio investments annually.
Bamboo is an investment platform that gives Africans real-time access to invest in or trade over 3,500 stocks listed on the American and Nigerian exchanges right from their smartphones or personal computer.
In partnership with US-based Drive Wealth LLC, Bamboo provides seamless, secure access to US and Nigerian securities.
Nairametrics | Company Earnings
Access our Live Feed portal for the latest company earnings as they drop.
- Seplat falls into a loss in FY 2020
- 2020 FY Results: Cornerstone Insurance Plc reports a 61.1% decline in profit
- Ellah Lakes increases operating expenses by 33.36% in HY 2020
- 2020 FY Results: Nigerian Breweries reports a 54.3% decline in profits in 2020
- Abbey Mortgage Bank projects N51.08 million profit in Q2 2020.