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Russian Crude Oil Price Cap And Price Mechanism

Published 23/11/2022, 15:10
Updated 23/11/2022, 16:14
Russian Crude Oil Price Cap And Price Mechanism

Russian Crude Oil Price Cap And Price Mechanism

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Prices as of 4 pm ET, 11/22/22; % YTD

MARKET UPDATE Volumes this week are close to yearly lows

  • Expect more of the same for today

Thursday U.S. Thanksgiving

  • U.S. stock exchange closed

  • Fixed income markets closed

Friday

  • U.S. stock exchange closed at 1 p.m.

  • Fixed income markets closed at 2 p.m.

2 p.m. Fed minutes from November 2nd meeting

  • Next Fed meeting December 14

VIX

  • Volumes and Volatility are Low

  • VIX at its lowest level since August

Crude $78

  • Lower despite API reporting a crude draw

Europe diplomats meet today

  • with the goal of approving Russian crude oil price cap and price mechanism

  • EU discussing capping /Russian oil at $65-70 per bbl, close to the $78 it is trading today

  • Dual goal of:

    • Keep Russian oil flowing as much as possible

    • Limit Russian revenues

  • will probably not be met.

  • Russians can say “we’re selling at market prices” (to China, India, etc) thus keeping Russian production at current levels

    • Russian will probably not say “we’re selling at the cap”, so Russian revenues will not be limited.

  • Ultimately, the market price will determine what Russia does

    • If oil prices fall below the cap, will Russia reiterate that it won’t supply countries that participate in the cap?

Apple (NASDAQ: NASDAQ:AAPL)

  • Apple workers at its main China plant clashed with security staff

  • after being locked up for almost a month under Covid restriction

  • Best Buy (NYSE: BBY) said high-end iPhones will be in short supply during the holiday season

Earnings

  • VMware (NYSE: VMW)

  • Autodesk (NASDAQ: NASDAQ:ADSK)

  • HP (NYSE: HPQ) will cut 10% of its workforce

  • Nordstrom (NYSE: JWN)

  • Deere (NYSE: DE) +3%, beat and guide raised,

  • Credit Suisse (SIX:CSGN) (NYSE: CS) $88 billion in outflows, expects Q4 pre-tax loss of $1.6B

CRYPTO UPDATE Digital Currency Group

  • Says no imminent thread

  • Owes Genesis (which it owns) $575 million

    • Due May 2023

  • Also owes Genesis $1.1 billion on promissory note due June 2032

  • “Collectively we will come out of it stronger”

  • Genesis hired investment bank Moelis & Company to explore options including bankruptcy

Cathie Wood: still very bullish

  • Sticking to $1 million price target by 2030

  • Bitcoin (CRYPTO: BTC) will come out of crisis smelling like a “rose”

SBF apology letter to FTX staff

  • “I didn’t mean for any of this to happen, and I would give anything to be able to go back and do things over again”

  • “I did not realize the full extent of the margin position, nor did I realize the magnitude of the risk posed by a hyper-correlated crash”

© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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