Oil prices rallied the most in history last week, but the 40%-plus gains only lifted prices from just under $20 to near $30. That’s not going to make anyone in Texas or North Dakota feel better. U.S. shale producers need oil prices over $50 to be comfortable, and even at that level they don’t make a ton of profits.
The market got a boost when President Trump planned to meet with oil executives with an eye toward helping the market stabilize and possibly slap tariffs on foreign supplies. But then producers got bad news when Saudia Arabia canceled a meeting with Russia to discuss cutting supply.
Now we’re back to positive news, but oil traders appear to be worn out.
The Kremlin said on Monday that Moscow is ready to coordinate with other leading oil exporting countries to help to stabilize the global oil market.
Kirill Dmitriev, head of Russia’s wealth fund, said that Saudi Arabia and Russia are “very, very close” to a deal on oil production cuts.
Kremlin spokesman Dmitry Peskov said:
“Moscow is ready for cooperation and interested in interaction with countries in order to stabilise the energy markets.”
Peskov also said that talks between OPEC and other leading oil producers, a group known as OPEC+, were delayed until Thursday for technical reasons and preparations for the meeting were under way.
Still, Brent crude prices were trading down 4.4% after the news, and West Texas Intermediate prices were off 3.3%.
It’s almost as if no one trusts any of them.