• 4 minutes 2nd Annual Great Oil Price Prediction Challenge of 2019
  • 7 minutes Nucelar Deal Is Dead? Iran Distances Itself Further From ND, Alarming Russia And France
  • 10 minutes Don Jr. Tweets name Ukraine Whistleblower, Eric Ciaramella. Worked for CIA during Obama Administration, Hold over to Trump National Security Counsel under Gen McCallister, more . . . .
  • 13 minutes Shale pioneer Chesepeak will file bankruptcy soon. FINALLY ! The consolidation begins
  • 3 mins More dumbed down? re Hong Kong Act of Congress
  • 2 mins U.S. Shale Output may Start Dropping Next Year
  • 18 hours EU has already lost the Trump vs. EU Trade War
  • 29 mins U.S. Shale To Break Records Despite Bearish Rhetoric
  • 3 hours Aramco IPO magic trick
  • 21 hours Pope Proposes New Sin: Thou Shalt Not Destroy The Harmony Of The Environment
  • 17 hours What are the odds of 4 U.S. politicians all having children working for Ukraine Gas Companies?
  • 5 hours Winter Storms Hitting Continental US
  • 2 hours Petroleum Industry Domain Names
  • 1 hour Crazy Stories From Round The World
  • 17 hours PennEast Appealing Wacky 3rd Circuit Decision to Supreme Court
  • 23 hours Article: Did Exxon only make $39 Million onshore U.S. last quarter ?
  • 22 hours Last I Checked
  • 17 hours China 2019 - Orwell was 35 years out
Tsvetana Paraskova

Tsvetana Paraskova

Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. 

More Info

Premium Content

$1 Trillion Money Manager Downplays The OPEC Deal

The market should not be overly enthusiastic over today’s oil price surge on reports that OPEC has managed to reach some kind of a deal to reduce supply, David Hunt, chief executive at asset manager PGIM, said in an interview with Bloomberg Television on Wednesday.

Hunt, CEO of the asset management group that manages US$1 trillion in assets, said the oil price surge today is “probably not” sustainable.

Earlier today, OPEC managed to reach the much-hyped agreement to cut output in a bid to boost oil prices. The ministerial meeting in Vienna is said to have clinched a deal to cut output by 1.2 million barrels per day to 32.5 million barrels per day, but the deal may come with a condition that non-OPEC producers also cut production, by some 600,000 bpd.

Oil prices are soaring on the OPEC deal news, and as of 10:50 AM (EST), WTI Crude was surging 7.21 percent at US$48.49, and Brent Crude was soaring by 7.65 percent at US$50.94, staying above the US$50 mark for a couple of hours now.

“For us who are long-term investors, we tend to look at the group of people who are gathering in Vienna and say ‘they’re fighting against history... The cost of producing crude, largely due to fracking technology, has dramatically changed the marginal economics of oil,” Hunt told Bloomberg Television. Related: Will Trump Send Electricity Bills Soaring?

According to Hunt, long-term investors like PGIM see the longer-run market fundamentals and sentiment as “much more important than whether we get a bounce of a couple of dollars on Brent today or not. Fundamentally the economics of oil have changed and we now need to work that through how different industries are pricing, and how commodities are priced on the basis of that”.

Hunt also cautioned against investors being too optimistic in the long run about equity indexes’ continued rally since Donald Trump was elected U.S. President.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:




Download The Free Oilprice App Today

Back to homepage



Leave a comment
  • Kr55 on November 30 2016 said:
    Telling everyone out of the goodness of his heart? Or because he is holding onto some bad bets that depended on a Trump crash and OPEC failing to make a deal?
  • adec on December 01 2016 said:
    This manager seem to emphasize on the cost of shale is lower, but how low he has not specified.
    On the other hand, which shale company is making money at $50, or $60? Almost none. Hunt is clueless.
  • Matthew Biddick on December 01 2016 said:
    adec is right I think. I'm in Oklahoma and from time to time I review some, not all, of the horizontal production histories here and I can tell you that many, many of those wells will never recover the cost of investment. For other horizontal wells, they might payout but it is on a timeline in excess of a decade and dependent on oil prices recovering significantly from the $40-$50 range. The horizontal plays here will probably mostly fall into the age-old "20-80 rule" where 20% of the wells will payout and have to carry the other 80% as much as they are able.

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play