Global business news twenty four hours a day at Bloomberg dot com, the Radio plus mobile, last, and on your radio. This is a Broomberg Business Flash from Bloomberg World Headquarters. I'm Charlie. Plot a mixed picture for stocks on this back to work Monday. The smp is higher up by one point, down down, indust reels down fifty points, a drop of three tenths of one percent, and we've gotten as stack up nineteen a game of four tenths of one percent. We are brought to you by the American
Arbitration Association. Business disputes are inevitable. Resolve faster with the American Arbitration Association, the global leader in alternative dispute resolution for over eighty five years. Learn more at a d R dot org. Gold trading law by twenty eight dollars, the ounce now down two point two percent to twelve sixty five. Crude oil down two and a half percent forty three fifty four for a barrel of West Texas Intermediate, a drop there of a dollar twelve So recapping a
mixed picture for stocks. The SMPI Index higher by a point, a gain of less than point one percent. I'm Charlie Palaton. That's a Bloomberg business flash. This is taking stock with Gatlin Hays and Pim Box on Bloomberg Radio. This is taking stock on Bloomberg. I'm pim Fox. Oil. Oil prices down today about two and a half percent. New head of the Energy Ministry, the oil ministry in Saudi Arabia,
wildfires in Western Canada, and conflict in Libya. Let's bring in Bill O'Neill, founder Partner Logic Advisors and expert when it comes to oil. Bill O'Neill, thank you very much for being with us. Can you just describe the US business first? Because I was reading your note and you talked about in bold face this decline in the total number of oil rays and I want to get too technical too quickly, but just to decribe what's going on
in the United States for people. Well, we've we've seen an absolutely beyond dramatic decline in the number of oil rigs. But the interesting thing to him is that there has been so much efficiency created and they knocked out so many of the inefficient minds. The US output, yes, it's down and will continue to go down, but it has declined at a much slower rate than if you look at just those absolute rig numbers would suggest so, um,
we're seeing lower US production, but not dramatic. We will see some further production declines and it will help at least off set some of the increases we're seeing, for example from from Iran and the continued avaricious production that we get from the slities. You mentioned avaricious production. Expand a little bit on that and maybe take us into this change at the top of the oil industry in Saudi Arabia. Well, it's very interesting in a sense, it's
not a total supply surprise. Rather, we we had expected that Ali Alimi, who has been there seems like forever, would be replaced. Um. The new UM minister is the former head of a RAMCO. And keep in mind in the background that the Saudis are looking to sell off at least a portion of a RAMCO, So I think that's part of it. UM. Also, they wanted someone new
with some fresh ideas. The new UH minister, his name is Khalid our Faith, is thought to be a bit even more hawkish than Naimi was as concerned sauty production. So what do you mean he wants to keep that market share. I mean that's what the Saudis have been doing. They've been doing everything possible to knock out the shale producers in the US, with as we just pointed out,
some modest success. UH. He probably will be even more so. Also, I think he will be less likely to participate in the oil freeze talks that are coming up in early June. They had that first round that failed, uh Mr Alphae. This uh appointment appears to be embarished for that as well. So I don't see anything really constructive short term now. Longer term, I think the Sorties will want to get the price of oil higher when they go into actually
selling UH Ramco. But for the near term they want to keep a firm hand, and that's gonna put a lid, if you will, on oil prices. Update us on Saudi Aramco and the plan to sell five PC. I'm sorry, I said again, just update us on the Aramco. The potential for a Ramco to sell five to the market, Well, it's there. They're looking to do it. I don't see it anytime soon though, but it's going to be something
that will gradually be phased in. UH. It's a very difficult thing to do given the Saudi Arabia looking to sell uh something, but it's gonna happen, I don't. I don't expect it to happen the short term. I think the focus is still going to be more on the supplied demand equations as far as a suities are concerned. What is the supplied demand equation right now? Supply versus demand? Well, if you look at absolute supply demand, there's still considerable
excess of of oil production is outstripping consumption. Now I do see some evidence. For example, today we've had some great figures out of China. While they're trade data in general was horrible, Uh, they increased their oil imports so that was a plus um and China appears to be doing some stockpiling as opposed to buying because of need, so we're seeing a little bit of that. So that's been supportive going forward. I think that may have run its course for a while, so that might not be
as supportive. So I think sup I will continue to weigh on the market. I do think though the global demand is underestimated by the consensus, and that's going to keep prices a little bit steady. So we were lucky enough. I guess you could say back in January right in our Daily Logic Advisors comment that we thought oil had bottomed. No reason to change that view at this point, though, I would not be chasing the market. I think there are a few short term negatives as far as supply
is concerned. Um, that could potentially because a little bit of a sell off. Also, the funds have gotten quite long here, so we could see a little bit of books square and come into the market as well, so people taking profits. Exactly last point to talking about natural gas. Natural gas, you talk talk about over supply markets, that's a that's a well over soul market. Demand is is decent, uh, but it's it's not that much above average that we
could expect anything. That's another market. I think it's probably discounted the worst of the news, but I think the spot demanding question there is far more negative than it isn't in oil. So I doubt that we're going to see any significant upside move there. Good news for the consumer actually should be down the line, you know, regular gasoline, that that that the pump has gone up, but I don't think it's gonna rock it up considerably from current level.
So I think, uh, the consumer is going to be in pretty good shape as far as energy is concerned. Will be a little bit of dinnertism. You at economy, Bill O'Neill, founder Partner Logic Advisors. That's very much for joining us. You're listening to taking Stock on Bloomberg Radio coming up. Are you interested in starting your own telecom network? Well, we're gonna be speaking with David mccorn and he knows just how to do it. That's next. I'm taking Stock