The White House confirmed on Tuesday that United States President Donald Trump held a telephone conversation with Saudi Crown Prince Mohammed bin Salman (MbS) to discuss Monday’s sharp losses in the oil markets following Riyadh’s decision to pump significantly more oil. The meeting took place on Monday and “other critical regional and bilateral issues” were also discussed. However, no exact information was given on exact topics. Saudi Arabia decided to increase its oil production after failing to agree with Russia on further output cuts during Friday’s OPEC+ meeting in Vienna. Meanwhile, reports suggested that Saudi Arabia was facing an internal crisis as a number of princes allegedly tried to oust MbS. Several princes are said to have been arrested in the afteermath
Trump struggles to calm nation after days of increasing pressure
WASHINGTON – President Donald Trump confronted one of the most perilous days of his presidency Monday by first erupting in a barrage of commentary that failed to calm the cratering financial markets, struggling to inspire confidence that his administration could stop the spread of the novel coronavirus. But by the time the sun set in Washington, Trump sounded momentarily chastened by the turbulence and previewed a raft of emergency measures to shore up the economy. “We have a very strong economy,” the president told reporters, “but this blindsided the world.”
Responding to days of mounting pressure from Wall Street executives and congressional allies, Trump said he plans to visit the Capitol on Tuesday to advocate for a payroll tax cut and other proposals to provide relief for hourly workers and others affected by the fallout.
Trump, who for weeks has resisted such steps, described the policies at a White House news conference as “very dramatic,” before ceding the lectern to Vice President Mike Pence and top public health experts to deliver a coronavirus update. Trump’s overall handling of the converging crises – while spreading misinformation and blaming others – has unsettled many of his Republican allies on Capitol Hill and even inside the White House, where some aides acknowledged that the president is compounding problems with his grievances and conspiratorial mind-set. President Donald Trump steps from the podium to allow Vice President Mike Pence to speak in the briefing room of the White House in Washington, Monday, March, 9, 2020, about the coronavirus outbreak.
The coronavirus and market meltdown present Trump with a challenge unlike any he has faced as president, and one for which he has no ready solution. At a moment when anxious citizens are turning to the government for facts and assurance, Trump is playing down risks and immersing himself in feuds with Democrats, the media and other perceived enemies.
During a meeting with the nation’s governors Monday in the White House Situation Room, Pence and his team tried to assuage their concerns and explain how states could seek emergency federal funds or provide guidelines on school closures and quarantines, which they anticipate only the hardest-hit communities might need. Maryland Gov. Larry Hogan, a Republican, expressed dismay after leaving the Pence meeting, saying Trump’s statements “sometimes conflict with the information we’re getting from the rest of the administration.” Inside the White House, some officials privately acknowledged Monday that Trump has exacerbated the problem with his series of mistruths and false statements, as well as his callous comments – such as saying he hoped infected cruise passengers would stay aboard the Grand Princess at sea because he didn’t want domestic coronavirus case numbers to rise. Markets plummeted Monday amid global alarm over the coronavirus and a showdown over oil prices, with the Dow Jones industrial average falling more than 2,000 points, or roughly 7.8%. It was the biggest drop for stocks since the beginning of the 2008 recession, and trading was so volatile that the New York Stock Exchange tripped the “circuit breaker” to temporarily halt trading in a bid to encourage stability.
Trump had resisted taking dramatic action, aides said, because he was fearful of causing alarm among the public or further rattling investors. But he changed course Monday after aides presented him with options they thought could help deal with the economic problems caused by the outbreak.
Trump told reporters that he will ask Congress to cut payroll taxes, provide relief to hourly workers and provide assistance to the airline, hotel and cruise industries, which are suffering because many Americans are canceling travel plans. “We’re taking care of the American public and we will be taking care of the American public,” Trump said.
Members of Trump’s coronavirus task force have also discussed declaring a national emergency, which would involve invoking the 1988 Stafford Act to enable the Federal Emergency Management Agency to take disaster-level action, officials said, but those discussions remain preliminary.
Treasury Secretary Steven Mnuchin and White House National Economic Council Director Larry Kudlow will meet with Senate Republicans at their lunch Tuesday, according to two people briefed on the plans. In addition, the White House has invited top Wall Street executives to meet this week. Trump has been reluctant “to shut down an industry” or “tell anyone they can’t go anywhere,” said a senior administration official. On Sunday, however, the State Department and the Centers for Disease Control offered guidance urging Americans – especially older adults with underlying health conditions – to defer cruise travel.
The day before, during a meeting with cruise executives, Pence issued a far sterner warning in private, according to someone familiar with the conversation. Pence told cruise executives that if they do not develop by Tuesday a clear plan to prevent another coronavirus outbreak from happening again on a ship, Trump is prepared to take much stronger actions than he has so far.
Publicly, Trump has accused the media of hyping coronavirus to damage his political standing. Privately, he brooded throughout the weekend about news stories that detailed the ways his administration squandered precious weeks and bungled its handling of the crisis, with much of the blame falling on the president.
“He sees the stories as everyone just being out to get him,” said one administration official, who spoke on the condition of anonymity to describe the president’s mind-set.
Trump is proud about the initial restriction he imposed on travelers from China and has repeatedly complained that he does not get enough credit, to the point of mentioning it in nearly every meeting, several senior Republicans said.
Trump has spent much of the past four days tending to campaign benefactors and preoccupied with his own political future. He has used those settings to complain about what he considers to be coronavirus hysteria in the media and overreaction by financial markets.
“It’s not that big of a deal,” Trump said at one of the events, according to people who heard the comments.
People who interacted with Trump over the weekend at his Mar-a-Lago Club in Palm Beach, Florida, or the nearby Trump International Golf Club, said the president was in gleeful spirits. He stopped by to toast Kimberly Guilfoyle, the girlfriend of his son Donald Trump Jr., at her 51st birthday party.
CDC: Americans over 60 should ‘stock up’ on supplies, avoid crowds
Italy expands lockdown to whole country
The fears fanned by the virus sent Wall Street stocks tumbling to their biggest drop since 2008, with the Dow Jones Industrial Average down 7.8%. Global oil prices suffered their worst percentage losses since the start of the 1991 Gulf War.
“Now that the virus has a foothold in so many countries, the threat of a pandemic has become very real,” said World Health Organization chief Tedros Adhanom Ghebreyesus. “The great advantage we have is the decisions we all make as governments, businesses, communities, families and individuals can influence the trajectory of this epidemic.” More than 113,000 people have been infected with the virus, and more than 3,900 have died of the COVID-19 illness it causes. Most of the cases are in China, but its proportion is shrinking as the caseload grows elsewhere. More than 62,000 people have already recovered. But Italy’s intensifying struggle to halt the virus’ spread emerged as a cautionary tale. “There won’t be just a red zone,” Italian Prime Minister Giuseppe Conte said, in announcing that a lockdown covering about 16 million people in the north would be expanded to the entire country starting Tuesday.
Italian doctors celebrated one small victory after the first patient diagnosed with the illness, a 38-year-old Unilever worker, was moved out of intensive care and began breathing on his own. But the virus’ rapid spread was forcing them to operate like war-time medics, triaging patients to decide who get access to scarce ICU beds.
“Unfortunately we’re only at the beginning,” said Dr. Massimo Galli, head of infectious disease at Milan’s Sacco hospital. Italy’s 9,172 cases and 463 deaths are the second-most in the world. China on Tuesday recorded just 19 new cases over the previous 24 hours, its lowest total since it began reporting national figures on Jan. 20.
Israel will quarantine anyone arriving from overseas for 14 days, a decision coming barely a month before Easter and Passover.
All St. Patrick’s Day parades were canceled in Ireland, including one in Dublin that typically draws half a million to its streets.
All schools in and around Madrid will close for two weeks. The rising number of cases around Spain’s capital “imply a change for the worse,” the country’s Health Minister Salvador Illa said.
In China, the slow emergence from its extreme quarantine measures spotlighted the virus’ continued economic impact. ds“Our business is one-fifth of what it was before,” said Cheng Sheng, who helps run a stand in Beijing that sells sausages and noodles. “There’s much less foot traffic. There are no people.”
Infections were reported in more than half the world’s countries, and flashpoints were erupting around the globe. Nick Note: its not the virus its the quarantines and business shut downs that is the problem!
Saudi Arabia to hike oil output above 10 million bpd in April after OPEC+ deal collapse
DUBAI (Reuters) – Saudi Arabia, the world’s top oil exporter, plans to raise its crude oil production significantly above 10 million barrels per day (bpd) in April, after the collapse of the OPEC supply cut agreement with Russia, two sources told Reuters on Sunday. Saudi Energy Minister Prince Abdulaziz bin Salman visited state oil giant Aramco on Saturday and asked the company to boost its crude output after the current OPEC+ cut deal expires at the end of March, the sources said. On Saturday, Aramco slashed its official selling price (OSP) for April for all its crude grades to all destinations, after OPEC’s oil supply cut pact with Russia fell apart on Friday, sending oil into a tailspin. The sources said that April’s production will be significantly higher than 10 million bpd, possibly closer to 11 million bpd. Saudi Arabia has been pumping 9.7 million bpd in the past couple of months. The message from the Saudi energy minister was that Aramco should maximise its output and sell more crude to protect its market share, the sources said. Saudi Arabia has an oil output capacity of 12 million bpd, giving it the ability to swiftly increase production. A three-year pact between OPEC and Russia ended in acrimony on Friday after Moscow refused to support deeper oil cuts to cope with the outbreak of the coronavirus and OPEC responded by removing all limits on its own production. Oil prices plunged 10% as the development revived fears of a 2014 price crash, when Saudi Arabia and Russia fought for market share with U.S. shale oil producers, which have never participated in output-limiting pacts. “The kingdom is not at war with anyone, but it is pursuing its own interest. Once the deal expires, everyone will raise production,” said the second source. Nick Note: This oil market has over priced the price war. US producers need $50 WTI. They cannot do it at even $40. this is a automatic supply cut. ALSO Crown Prick Salamander has really fucked it up this time.. For the record Oil has put in a major bottom and will rally from here.
Europe tanks at open amid coronavirus, oil crisis
European equity indices were red across the board at the open on Monday as the coronavirus outbreak coupled with crashing oil prices rattled markets. Adding to the turmoil were plunging Treasury yields with the 10-year US Treasury note dropping below 0.4% for the first time ever. Brent futures for May settlement were down 25.98% to $33.51 per barrel at 8:48 am CET, while West Texas Intermediate for April tumbled 27.91% to $29.76 a barrel at the same time. The drop in prices comes after last week’s failed OPEC+ meeting, which led Saudi Arabia to slash crude prices for April. The DAX sank 7.47% at the open, as the FTSE 100 lost 1.82% in the first minute of trade, only to fall nearly 9% minutes later. The euro gained 1.13% against the dollar at 9:05 am CET, buying 1.14335. At the same time, the pound advanced 1.10% versus the greenback to go for 1.31762.
Dow plummets over 1,500 pts in premarket trade
Shares on Wall Street crumbled further in premarket trade on Monday as markets continued to be gripped by fears over the coronavirus outbreak and crashing oil prices. Following a collapse in talks between Saudi Arabia and Russia at the OPEC+ meeting in Vienna last week, the Gulf kingdom decided to engage in a so-called price war, cutting prices of its crude for April. The move triggered a 30% drop in crude benchmarks overnight. Treasury yields also tanked, with the 10-year US Treasury note dropping below 0.4% for the first time ever. The Dow was down 1,562 points at 4:39 am ET. At the same time, the S&P 500 fell 6.72% while the Nasdaq 100 lost 5.08%.
CRASH CRASH CRASH
Take the day off and get ready for the biggest market event in over a decade! the markets are coming apart at the seams. the day and in fact days we have long predicted are upon us
Two years from now you will regret not breaking open the cookie jar and going for broke!
I guarantee you nothing. I am offering you a lottery ticket!
Aramco’s drop below IPO price deals blow to Saudi economic plan
DUBAI (Bloomberg) –Saudi Aramco shares dropped below their IPO level for the first time as a looming price war in global crude markets battered the outlook for the kingdom’s flagship oil company.The stock fell as much as 9.4% in Riyadh before trimming losses to close down 9.1% at 30 riyals. That compares with the 32 riyals at which it began trading on Dec. 11. The Tadawul All Share Index retreated 8.3%.
Markets across the Middle East tumbled Sunday after Saudi Arabia ignited an all-out oil price war by slashing pricing for its crude, making the deepest cuts in more than 30 years on its main grades. The declines for Saudi Aramco are a setback for a government that had celebrated last year’s record $29 billion initial public offering as a showpiece of Crown Prince Mohammad bin Salman’s drive to open up the energy-dependent economy.
Aramco’s pricing cuts were the first response to the breakup on Friday of OPEC’s alliance with partners like Russia. Oil plunged the most since 2008 following the failure of the talks. The outcome of that oil suppliers’ meeting was “an astonishing reversal of what appeared to be a pending production cut” to compensate for lower demand caused by the coronavirus outbreak, said Edward Bell, senior director for market economics at Emirates NBD PJSC in Dubai. “Aramco was extremely clear in its prospectus that production decisions are set by the government, not the company. So, this will be the first implication of that clause in Aramco strategy.” The kingdom plans to increase crude output next month to more than 10 million barrels a day, according to people familiar with the conversations, who asked not to be named to protect commercial relations. Shares of Aramco, the world’s biggest oil exporter, had largely defied gravity since they were listed, not falling below the IPO price even as the coronavirus led to a slump in crude. As of March 5, the stock had slipped only about 6% this year. Aramco’s recent performance contrasts with an initial rally of about 20% within the first two days, a surge that boosted the oil giant’s valuation to the $2 trillion Prince Mohammed was seeking. The company’s IPO was central to the prince’s ambitious strategy of generating funds to diversify the economy and wean Saudi Arabia from its dependence on oil. In the end, the shares were sold mostly to local investors, who were encouraged to buy after foreigners balked at the offering price. The drop for Aramco on Sunday means more than $400 billion of market value has been wiped out in about three months, compared with a peak market value in excess of $2 trillion that it reached in December.
An index tracking energy shares in Europe lost 5.5% on Friday, the most for a session since June 2016, with major producers such as Total SA, BP Plc and Royal Dutch Shell Plc retreating between 4.9% and 5.9%. In the U.S., Exxon Mobil Corp. dropped 4.8%. Aramco’s slump could deter the government from selling more shares either domestically or on a foreign exchange, a possibility that Chairman Yasir Al Rumayyan laid out in an interview last month. Out of 18 analysts tracked by Bloomberg, two have a buy recommendation for Aramco, while there are 12 hold and four sell ratings. The collapse of the meeting between the Organization of Petroleum Exporting Countries and its erstwhile partners effectively ends the cooperation between the Saudis and Russia that has underpinned oil prices since 2016. Unshackled from the cartel’s restrictions and with budget holes to fill, there is every chance producers will ramp up output. A reduction in the official selling prices, or OSPs, suggests the Saudis are looking to do just that. “Saudi Arabia is now really going into a full price war,” said Iman Nasseri, managing director for the Middle East at oil consultant FGE.