Homepage / Investment / China has an Iran oil lever over Trump and it's all playing out at OPEC meeting
Amazon says this Prime Day was its biggest shopping event ever Kudlow says President Trump is 'so dissatisfied' with China trade talks that he is keeping the pressure on As stocks regain their footing, an ominous warning looms Goldman Sachs downgrades Clorox to sell, says valuation is 'unsustainably high' How Satya Nadella has spurred a tripling of Microsoft's stock price in just over four years Kudlow says economic growth could top 4% for 'a quarter or two,' more tax cuts could be coming The one chart that explains Netflix’s stunning comeback US housing starts plunge 12% in June to a nine-month low Aerospace titans Boeing and Airbus top $110 billion in orders at Farnborough Target uses Prime Day to its advantage, logging its 'biggest online shopping day' so far this year Billionaire Marc Lasry sees bitcoin reaching up to $40,000 as it becomes more mainstream and easier to trade These are the 10 US airports where you're most likely to be hacked Amazon shares slightly higher as investors await Prime Day results Wreck of Russian warship found, believed to hold gold worth $130 billion A bullish ‘phenomenon’ in bond market is weeks away from fading, top credit strategist says Stocks making the biggest moves premarket: MS, GOOGL, TXN, UAL, NFLX & more Twitter shares up 50% since late April means most upside priced in, analyst says in downgrade EU fines Google $5 billion over Android antitrust abuse Mortgage applications fall 2.5% as buyers struggle to find affordable homes America may not have the tools to counter the next financial crisis, warn Bernanke, Geithner and Paulson Investors are getting spooked as the risk of a no-deal Brexit rises EU expected to fine Google $5 billion over Android antitrust abuse Ex-FBI chief James Comey urges Americans to vote for Democrats in midterm elections Elon Musk apologizes to British cave diver following baseless 'pedo guy' claim Disney, Comcast and Fox: All you need to know about one of the biggest media battles ever Xiaomi shares notch new high after Hong Kong, mainland China stock exchanges reach agreement The trade war is complicating China's efforts to fix its economy European markets set for a strong open amid earnings; Google in focus Hedge fund billionaire Einhorn places sixth in major poker tournament The biggest spender of political ads on Facebook? President Trump Asian stocks poised to gain after Fed's Powell gives upbeat comments; dollar firmer Stocks are setting up to break to new highs Not all FAANG stocks are created equal EU ruling may be too little, too late to stop Google's mobile dominance Cramer explains how Netflix's stock managed to taper its drop after disappointing on earnings Airbnb condemns New York City's 'bellhop politics,' threatens legal retaliation Amazon sellers say they were unfairly suspended right before Prime Day, and now have two bad choices Investor explains why 'duller' tech stocks can have better returns than 'high-flying' tech names Elon Musk is 'thin-skinned and short-tempered,' says tech VC Texas Instruments CEO Brian Crutcher resigns for violating code of conduct Google Cloud Platform fixes issues that took down Spotify, Snapchat and other popular sites Uber exec: We want to become the 'one stop' transportation app 'What a dumb hearing,' says Democrat as Congress grills tech companies on conservative bias Amazon shares rebound, report says Prime Day sales jumped 89 percent in first 12 hours of the event How to put your medical history on your iPhone in less than 5 minutes Investment chief: Watch these two big events in 2018 Even with Netflix slowing, the market rally is likely not over Cramer: Netflix subscriber weakness debunks the 'sky's the limit' theory on the stock Netflix is looking at watch time as a new area of growth, but the competition is stiff Why Nobel laureate Richard Thaler follows Warren Buffett's advice to avoid bitcoin Rolls-Royce is developing tiny 'cockroach' robots to crawl in and fix airplane engines After Netflix plunge, Wall Street analysts forecast just tame returns ahead for the once high-flying FANG group Roku shares rise after analyst raises streaming video company's price target due to customer growth China is investing 9 times more into Europe than into North America, report reveals Amazon says US Prime Day sales 'so far bigger than ever' as glitch is resolved Netflix is on pace for its worst day in two years US lumber producers see huge opportunity, rush to expand San Francisco to consider tax on companies to help homeless Homebuilder sentiment, still high, stalls as tariffs, labor and land drive up costs Powell backs more rate hikes as economy growing 'considerably stronger' Netflix history is filled with big stock declines – like today – followed by bigger rebounds Intel shares get downgraded by Evercore ISI due to rising competition from Nvidia, AMD Petco aims to reinvent the pet store with something you can't buy online Genetic testing is coming of age, but for consumers it's buyer beware Tech 'FAANG' was the most-crowded trade in the world heading into the Netflix implosion, survey shows Netflix weak subscriber growth may indicate a 'maturity wall' that could whack the stock even more: Analyst This chart may be predicting the bull market's demise Wall Street says Netflix's stock plunge is a ‘compelling’ buying opportunity because the streaming giant ‘never misses twice’ Tesla sinks after Musk tweets, again Boeing announces new division devoted to flying taxis Stocks making the biggest move premarket: NFLX, UNH, GS, AMZN, WMT & more Deutsche Bank downgrades Netflix, but says big subscriber miss is not 'thesis changing' IBM is experimenting with a cryptocurrency that’s pegged to the US dollar North Korea and Zimbabwe: A friendship explained Virgin Galactic spinoff Orbit to launch rockets from the UK with space deal Artificial intelligence will create more jobs than it destroys? That’s what PwC says ‘Treasonous’ Trump and ‘Putin’s poodle:' Scathing headlines follow the Trump-Putin summit China’s fintech companies offer ‘enormous’ opportunity, investment manager says Trump's performance at summit with Putin was 'unprecedented,' experts say Walmart and Microsoft link up on cloud technology as they both battle Amazon European stocks seen mixed amid earnings; Fed’s Powell to address Congress How I knew I should quit my day job and run my start-up full-time: Viral website founder China's stocks have been trounced, but the trade war may ultimately be good news for those shares Billionaire tech investor Peter Thiel bets on crypto start-up Block.one Asian shares subdued open after mixed close on Wall Street; energy stocks under pressure Amazon cloud hits snags after Amazon Prime Day downtime Netflix isn't doomed by one quarter unless people start questioning the long-term investor thesis Tech stocks set to sink on Tuesday after rough evening for ‘FANG’ Netflix plummets after missing big on subscriber growth This wristband lets humans control machines with their minds The U.S. has a rocky history convincing Russia to extradite computer criminals Amazon suffers glitches at the start of Prime Day Jeff Bezos is now the richest man in modern history 'The United States has been foolish': Read Trump and Putin's full exchange Goldman Sachs recommends these 5 highly profitable companies — including Nvidia — to combat rising inflation Goldman Sachs releases 'tactical' stock picks for this earnings season Three red flags for Netflix ahead of its earnings report The bond market may be raising recession fears, but don't expect one anytime soon Cramer: Banks are 'making fortunes' but are still as hated as they were during the financial crisis Putin told Trump at summit: Russia never meddled in US election

Investment

China has an Iran oil lever over Trump and it's all playing out at OPEC meeting

The U.S. trade dispute with China, in a round about way, could determine how successful the U.S. will be in sanctioning Iran’s oil this time around — and that uncertainty is also playing out at OPEC.

In the tit-for-tat tariff war with the U.S., China said last week it would put tariffs on U.S. oil imports. The U.S. is not a major oil exporter, but it has been growing exports and is exporting about 2 million barrels a day of crude. About 300,000 barrels of that heads to China each day, and China could stop those purchases depending on how the trade dispute develops with the U.S., according to Scott Sheffield, executive chairman of Pioneer National Resources.

At the same time, China is a major player and as the biggest importer of crude, it could tilt the world scales in determining how much Iranian crude will be taken off the world market. Analysts expect buyers of Iranian crude in Europe and places like Japan and South Korea to slow down or stop buying Iranian supply before the end of the year.

OPEC, meanwhile sees a need to return oil to the market because of Iran and other outages, including the steady decline in Venezuelan output, but its members are squabbling among themselves over how much oil to return to the market, and that decision is critical to the Organization of Petroleum Exporting Countries deal of cooperation with Russia and other producers who meet on Saturday.

OPEC’s discussions of how much oil to return to the market are also key to its agreement with Russia and other producers, but there is disagreement. Saudi Arabia is believed to want to return 500,00 to 600,000 barrels to the market but Iran objects to increasing output. Russia’s energy minister has said Russia would like to return 1.5 million barrels a day just for the third quarter and take measure of the market after that.

“If OPEC doesn’t do something, I think we will see a $100 oil price,” Sheffield said.

Sheffield said China and India remain the two wild cards when it comes to Iran, though India’s state bank has warned about curbing financing for Indian refiners buying Iranian crude. China could curb, maintain or even increase its purchases of Iranian oil. China had a system for purchasing Iranian crude with a separate entity and payment system that did not engage with the U.S. banking system the last time sanctions were imposed on Iran, and analysts say it could use that method again to buy Iranian imports that would most likely come to it at a discount.

Trump’s move has set off a scramble around the world by oil customers to replace those Iranian barrels because of the financial restrictions the U.S. has put on companies that would deal with Iran. That shifting of oil supply is an issue at the heart of debate at this week’s OPEC meeting.

“OPEC doesn’t know if 200,000 or a million barrels of Iranian oil will be off the market,” said Sheffield. Iran exports about 2.4 million barrels a day and analysts expect the U.S. sanctions to remove about 500,000 from the world market by the end of the year. The last time the U.S. and other nation as sanctioned Iran, about 1.2 million barrels a day were taken off the market. Sheffield said there would be other buyers for any U.S. crude that China does not take.

Sheffield was speaking to CNBC on the sidelines of an OPEC seminar, which is a two-day event including global industry leaders ahead of Friday’s OPEC ministerial meeting.

This week’s headlines from OPEC have focused on the fiery comments of Iran Oil Minister Bijan Namdar Zanganeh who has been blasting President Donald Trump for politicizing oil when he blamed OPEC for high prices and reinstated sanctions oniran

“The real responsibility for oil prices being high lies with the president of the United States,” Zanganeh told the seminar. He said oil prices have risen since Trump withdrew from the nuclear deal but he has blamed OPEC for high prices. Trump has twice blamed OPEC for high prices on Twitter.

Zanganeh also said OPEC is an independent organization and Trump cannot turn it on one of its founding members.

In conjunction with the end of the nuclear deal, U.S. officials have sought help from Saudi Arabia to keep the market stable. Both Saudi Arabia and Russia have said they would like to return oil to the market, since their 18-month long effort to curb oil production by 1.8 million barrels a day has depleted a world oil glut and sent prices higher.

Russia Deputy Energy Minister Alexey Teksler told the seminar he is confident OPEC and other producers will reach an agreement on new production goals by Saturday’s meeting.

“Numbers will keep on changing but the agreement should not change. We should keep it in tact,” said Oman Energy Minister Mohammed in Hamad Al-Rumhy.

The sanctions on Iran were reinstated when Trump decided last month to withdraw from the Iran nuclear deal between Iran and six nations because he felt the terms were too favorable toward Iran.

Sheffield was the first representative of the U.S. shale oil industry to speak at an OPEC summit, and OPEC has sought to engage shale players for the past two years as U.S. production boomed and now surpassed that of Saudi Arabia.

Source: Investment Cnbc
China has an Iran oil lever over Trump and it's all playing out at OPEC meeting

Comments are closed.