Specialist
Founder at Queen Anne's Gate Capital Management LLC
Agenda
- The Organisation of the Petroleum Exporting Countries (OPEC)+ agreement – history and factors leading to collapse
- Saudi response and production capacity plans – economic reform implications
- Next steps for OPEC
- Implications for US oil producers
Questions
1.
What was the 2016 OPEC+ agreement? Why was it necessary and what made it different?
2.
Who are the key OPEC+ countries involved?
3.
Has the OPEC+ agreement been effective in balancing the oil market?
4.
Why did the agreement break down this month?
5.
How has Saudi Arabia’s position changed? It originally proposed an OPEC cut of one million barrels per day.
6.
Would you characterise Saudi Arabia’s response as impulsive, or would it have done the same had this been a scenario it had anticipated prior to this month?
7.
Saudi Arabian oil production was just over 11 million barrels per day in 2018. Do you think it can get to 12 million, or 12.3 million? How much of that will come out of inventory?
8.
Would it be possible for Saudi Arabia to go from 12 million barrels per day to 13 million? Do you think
there’s a credible timeline? How much do you think it would cost to do that?
9.
What do you think all this means for Saudi Arabian economic reform? Do you think it’s going to drive the
price down and invest more in oil capacity as opposed to diversifying into other industries?
10.
What do you expect to happen to the OPEC cartel? Will anybody show up at the next meeting? Is it over?
How will it manage the market, if at all?
11.
In the meantime, is it a free-for-all with the other OPEC members? Are they all going to increase
production to the extent they can?
12.
How long do you think Saudi Arabia is willing to continue? It started a share war in 2014 and a couple of
years later we had the OPEC+ agreement. How do the prospects for this share war compare?
13.
How long do you think the Russian producers or Russia itself could last in a price war?
14.
What would you tell a generic US oil producer about what happened and what to expect?
15.
In the last down cycle, US producer efficiency increased dramatically. Do you think those opportunities still
exist to drive down costs?
16.
When do you think US production could start to decline?
17.
How do you expect customers of oil producers to behave in all this? Is it a great buying opportunity? Are
they holding off, or is demand so bad that nobody cares?
18.
What are your thoughts on the oil balance for the year? How far off is supply and demand?
19.
Where is the storage available today? Does it vary by geography? Is it the available storage in certain countries?
20.
What are your thoughts on price? Where could it go? It’s come down pretty quickly.
21.
Why do you think the Canadian supply won’t get cut that fast?
22.
Are there any winners in this? It seems there are a lot of losers.
23.
What are your thoughts on other interventions in this market? Is there any potential reconciliation with Saudi Arabia? Could Washington do anything?
24.
What should investors monitor in the oil market?
25.
Is there anything we haven’t covered that we should be paying attention to?