WEEKLY ENERGY RECAP: Trading range squeezed

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Updated 19 July 2020

WEEKLY ENERGY RECAP: Trading range squeezed

  • The consensus within OPEC+ shows a unity capable of bringing the market into balance

Oil prices moved in the narrowest range ever this past week.

Brent crude oil fell by only 10 cents from the week earlier to close at $43.14 per barrel while WTI moved higher by only 4 cents to $40.59 per barrel. 

These prices are extremely close to July average for both benchmarks so far.

Historically large output cuts by OPEC+ of nearly 2 million barrels per day through the end of the year are already well priced into the market.

OPEC’s 13 members pumped 22.27 million bpd in June. The 23 OPEC+ producers have successfully achieved 107 percent compliance with their committed cuts, according to OPEC data seen by S&P Global Platts. Non-compliant producers have also committed to make up for their shortfalls in August and September, making the headline cuts larger.

The huge consensus within OPEC+ demonstrates a powerful sense of unity that is capable of bringing the market into balance and adjusting output as needed.

Rising coronavirus cases worldwide continued to cloud the short-term outlook as infection numbers climbed again in some major economies that had eased restrictions.

Still, the market remains well supported by inventory data released by the US Energy Information Administration (EIA), which showed a large drawdown of 7.5 million barrels.

One potential challenge to the compliance and cohesion of OPEC+ may be the reluctance of some refiners to increase their refining capacities as the recovery in fuel demand remains fragile. 

While Chinese refiners throughput surged to the highest on record in June, Asian refiners may be cautious about boosting crude imports as the demand outlook remains foggy.

• Faisal Faeq is an energy and oil marketing adviser. He was formerly with OPEC and Saudi Aramco. Twitter:@faisalfaeq


Apple, Google drop Fortnite from app stores over payments

Updated 14 August 2020

Apple, Google drop Fortnite from app stores over payments

  • Google said Fortnite will remain available on Android, just not through its app store
  • Apple and Google both take a 30% cut from in-app revenue purchases in games

NEW YORK: Apple and Google dropped the popular game Fortnite from their app stores after the game’s developer introduced a direct payment plan that bypasses their platforms.
Apple and Google both take a 30% cut from in-app revenue purchases in games, which has long been a sore spot with developers.
Fortnite is free, but users can pay for in game accoutrements like weapons and skins. Its developer, Epic Games, said in a blog post Thursday that it was introducing Epic Direct payments, a direct payment plan for Apple’s iOS and Google Play. Epic said the system is the same payment system it already uses to process payments on PC and Mac computers and Android phones.
Apple and Google said the service violates their guidelines.
“Epic enabled a feature in its app which was not reviewed or approved by Apple, and they did so with the express intent of violating the App Store guidelines regarding in-app payments that apply to every developer who sells digital goods or services,” Apple said in statement.
Google said Fortnite will remain available on Android, just not through its app store. Android users can download the app from other app stores, although that’s generally not an option for iPhone users.
Epic Games did not immediately return a request for comment. Epic’s Fortnite Twitter account said the company would debut a new short film called “Nineteen Eighty-Fortnite,” a seeming parody of Apple’s iconic “1984” commercial that introduced the Macintosh computer. It has also filed a complaint against Apple in the US District Court in Northern California for dropping Fortnite.