US Oil Price Jumps to Six-Year High After OPEC deal failure

[Klaralven]

Oil rose to the highest level in more than six years in New York as the failure of OPEC+ to ratify a production increase spurred concerns of an acute supply shortfall.

With the collapse of talks on Monday, the Organization of Petroleum Exporting Countries and its allies won’t boost output in August, unless an agreement can be salvaged. That will deprive the global economy of vital extra supplies as demand recovers rapidly from the coronavirus pandemic.

West Texas Intermediate crude for August delivery advanced as much as 2.4% from Friday’s close to $76.98, the highest since November 2014. Crude’s rally will inevitably fan concerns over inflation that are fixating central banks and much of Wall Street.

“As negotiations continue, we estimate that most outcomes still imply higher prices in coming months as the physical market tightens," Damien Courvalin, head of energy commodity research at Goldman Sachs Group Inc., said in a report.

https://www.livemint.com/industry/energy/us-oil-price-jumps-to-six-year-high-after-opec-deal-failure-11625562395140.html

[andym]

1. Prices have dropped since that story

Crude oil futures down 2.5% to 73.23. https://finance.yahoo.com/quote/CL%3DF?p=CL%3DF

[SWBTATTReg]

2. All in all, as usual, a very temporary bump in prices but wait! Rump and the gop will endlessly

tout doom and gloom, etc. Ridiculous. There are thousands of shut down wells that could be opened back up if need be, when prices collapsed, roughly a year or so ago ... therefore, be alert to anybody saying that Biden's screwed up, blah blah blah...garbage of course.

--snip--
Apr 27, 2020 · Deeper production cuts seem inevitable to stop the collapse of oil prices in the coming few months. Once COVID-19 is contained and economic activities around the world resume, market forces are likely to bring back the balance between supply and ...
--snip--

[Metaphorical]

3. There's still significant capacity

At these prices, midwest shale producers, who have been mostly sitting on the sidelines, are starting to resume production. Oil's going to be range-bound for a while in the $65-$75 bbl range. China's also been releasing inventories, after having gone on a massive oil-buying spree when it was cheaper, and that's going to keep prices steady.

My only real worry about the oil market is the early hurricane season, and that's going to affect distillates like gasoline and aircraft fuel more than it does oil production per se.

[dickthegrouch]

4. I paid $4.559 per gallon at Valero last night

Regular 87 octane gas.
Most I’ve paid in a long time.
Santa Clara county, CA.