The extraordinary oil and gas bust

Thursday, 19 March 2020

The oil crash is now kind of unbelievable:

It is my view that oil is going to $10 and, possibly, zero.

Even accounting for the tumbling AUD, this has now dropped local gas contracts to around $6Gj, double what they should be but half what they were. Contracts are generally priced at around 14% of Brent. This has all but destroyed gas cartel equity with more falls today likely:

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.