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OPEC+ Is Dead. No Telling Where Bottom Is For Crude.
On Thursday evening, in "And I’ll Dance With You In Vienna", I suggested the standoff between the Saudis and the Russians over a proposed massive production cut aimed at stabilizing oil prices would likely end in a compromise.
It didn't. Instead, Russia refused to budge, in what some say is a bid to let prices fall further in order to cripple US shale. "Small shale oil producers will bite the dust", Commerzbank said, in a note. "The market rebalancing will be shared with more producers, not j
Technically the US dollar should fall in response to the decline in crude, being that the US is now a petrochemical state. US GDP decline should follow. I use the term ‘should’ because I am cognisant of the fact that the dollar is a safe haven asset. Nice to see the USD/JPY moving down again, but I don’t think people will be ditching their dollars for Yen en masse just yet.
So let’s add oil patch job losses to the inevitable travel/leisure/hospitality job losses. Maybe some small & medium sized bank job losses as NIM’s get crushed to nearly nothing.
Seems like today’s NFP report may end up being “peak employment” in this decade-long cycle.