🌚😏 OPEC... u up?
OPEC is literally up, even if its 2AM, because they need to boost oil production! Ha.
OPEC stands for Organization of the Petroleum Exporting Countries, and it consists of 15 member nations, most notably Saudi Arabia and the UAE.
Their objective is to coordinate policy on the supply of oil/gas/petroleum, so that there’s an “efficient” regular supply of oil to consuming countries, and a “fair” return on capital to those investing in the industry.
In other words, it’s a cartel that can manipulate the prices of oil as they see fit, LOL.
Anyway, as a cartel, the OPEC+ member countries collectively agree on how much oil to produce, which directly impacts the ready supply of crude oil in the global market at any given time.
They scale back and scale up production depending on demand, and so right now what you see happening with gas prices is that prices are up due to increased demand but the same amount of supply. If supply were to increase, then gas prices would lower.
“OPEC acts as a cartel. Essentially, they behave as if they were a single producer and restrict output to raise prices and revenues. Since oil is a global market, the impacts of OPEC production decisions affect the price of all oil, not just that sold by OPEC countries”.
I learned something new today! I hope you did too. Enjoy this edition of Hump Days, and I’ll see you next week.
— Humphrey
In the Markets
Upcoming Earnings
Another notable earnings call this week is Robinhood moved up their earnings to August 18th! Should be interesting.
Weekly News Roundup
White House Calls on OPEC to Boost Oil Production (CNBC)
After OPEC+ had scaled back production by 10 million barrels per day in the middle of 2020, the White House is calling for increased oil production and that “OPEC+ must do more to support the recovery.” The national average for a gallon of gas is currently ~$3.186 (up by over $1.00 in the last year).
HY: My local “most expensive” gas station is close to $5.5 a gallon now in California. Costco near me is still $4.19.
Cuomo Resigns as New York Governor Amid Harassment Claims (BBG)
Following a pressure to leave office or face impeachment in the wake of multiple sexual harassment allegations, (former) New York Governor Andrew Cuomo announced his resignation. Lieutenant Governor Kathy Hochul will take over, becoming New York’s first female governor.
HY: Surprised it look this long, actually.
Millions of Americans Are Unemployed Despite Record Job Openings (WSJ)
The number of available jobs since May has outnumbered those currently looking for work. However, a major factor behind that statistic is that there seems to be a mismatch between where people want to work and which industries are hiring.
RH: Before any assumptions are made, the hardest hit industries have yet to get back to pre-pandemic levels.
HY: I think I mentioned this last week, but right now there’s a mis-match between open jobs and the skills required by the unemployed to get them.
In Case You Missed It
I’ve been changing up the thumbnail on this video, but the “click-through” rate is not high at around 1.9-2.2%, typically you want a video to have 5-10% (for me). Not sure why, I think CTR’s are just down across the board. I do have a fun video coming up on Monday called “The Dark Side of Day Trading”, I hope you watch that one :)