Submitted by Irina Slav via OilPrice.com,
Iran has extnded its discount on the June contract for its heavy crude going to Asia, just a few days after Saudi Arabia announced a price increase for its own June contract for the continent. With this new discount, Iranian oil will be noticeably cheaper for Asian clients than both Saudi and Iraqi crude.
Earlier today, the OPEC released its latest monthly forecast which echoed what the IEA said yesterday, as the organization which Roseneft CEO Sechin said has "practically stopped existing", said shrinking U.S. output and massive cuts to investment in new projects will reduce the global oil glut over the course of this year, potentially pushing world-wide oil production lower than demand in 2017.
In the latest indication of contracting global growth, overnight Hong Kong reported that its Q1 GDP fell off a cliff 0.4% qoq, widly missing estimates of 0.1% growth as retail sales plummeted and the property market continued its collapse. On a y/y basis, the economy grew only 0.8% when compared to the same period last year, less than half the 1.9% y/y growth reflected in Q4.
Global stocks have started Friday the 13th on the wrong foot, with not only Hong Kong GDP unexpectedly tumbling by 0.4%, the worst print in years while retail sales fell for a thirteenth straight month in March, the longest stretch since 1999 as the Chinese hard landing spreads to the wealthy enclave, but also following a predicted collapse in Chinese new loan creation, which will reverberate not only in China but around the globe in the coming weeks.
If yesterday's selloff had a specific catalyst, namely some of the worst consumer retail earnings seen in years, it merely undid the Tuesday rally which levitated global risk with no fundamental driver, aside for a 200 pip spike in the USDJPY. Some central bankers may even say it was a "magical" levitation.