While much was made of this week's drop in US crude production, it was driven by an Alaskan supply drop, not the Lower 48 whose production is at Aug 2015 highs. WTI back above $50 on the back of more OPEC jawboning appears to have everyone convinced this time is different, but for the 18th week in a row US oil rig counts rose (by 8 to 720).
The following article by David Haggith was published first on The Great Recession Blog:
The last time OPEC (and Non-OPEC) member nations sat down to attempt a coordinated increase in oil prices by cutting production they succeeded... for about three months. Every since then, oil has been on a gradual declining path, boosted by a surge in US shale output and declining global demand, with WTI recently even sliding sliding below OPEC's implicit price floor of $50/barrel. Which is why on May 25, after the failure of the first 6 month production cut, the same nations will try the same exercise, this time looking to cut output for 9 months, and hoping for a different outcome.
Via The Daily Bell
As one would expect, in a week that saw the biggest one-day drop in US equities since last September, retail investors bailed on US stocks resulting in what BofA dubbed "risk-off flows" as $1.6 billion was pulled from global equities - with active managers once again getting the short end of the stick, with $4.3 billion in outflows from mutual funds, largest in 7 weeks while another $2.7 billion flowed into ETFs - offset by $9.7 billion inflows to bonds and $0.2 billion to gold.