Important day for the pound and The New American Energy Era

27 Mar 2019

Today, the most interesting things will happen in the Parliament of Great Britain. Recall Parliament took control of Brexit on Monday. Today is the day when the fate of the Brexit strategy can be decided. Moreover, the range of alternatives is more than diverse: from exiting without a deal to canceling Brexit. Accordingly, the “reaction” of the pound might be very different. We have our own opinion on this. we are in a hurry to share with our readers.

So, possible options include: a second referendum, a decision to stay in the EU, a decision to leave the EU without a deal, or the cancellation of Brexit. The last option seems to us extremely unlikely, since the Parliamentarians have already voted against it. This is the only option in which the pound is guaranteed to fall.

All other options suggest its growth. The most interesting and exciting is the decision to hold a second referendum. Although votes in his support may not be enough. Voting for the cancellation of Brexit is also a rather interesting option, but again, rather dubious. The most likely we see further inhibition of the process in one way or another.

An important nuance of today's voting - they are indicative. That is optional for execution by the Government. Theresa May can even ignore them. But on the other hand, there is so little time left that the option that has scored the most votes “in favor” may well be chosen as the base one.
We recommend buying a pound. But racing is possible in both directions. For example, parliamentarians vote for a second referendum - in this case the pound will sharply go up, but then Theresa May will “ban” this initiative, and the pound will bounce down dramatically. These slides can be used for earnings.

Another quite interesting statement recently was noted by US Energy Secretary Rick Perry, who said that the world is entering a new "American energy era." It's difficult to argue with him. If 3-4 years ago nobody could even think about exporting oil from the USA, today the country exports over 3 million barrels per day, increasing export volumes by almost 100% per year. By 2020, oil export from the United States is expected to reach 5 million barrels per day (an increase of 70% from current volumes).

To understand what the figure of 5 million b / d for the oil market means, we note that from all OPEC countries only Saudi Arabia exports large volumes. The US plans over the next 5 years to overtake Russia in terms of exports and become the world's second-largest oil exporter with a volume of over 9 million b / d (after Saudi Arabia). Looking at these statistics, it's difficult not to agree with the US Energy Secretary. So globally and strategically, oil is worth selling. But here and now, in the current term, we recommend buying oil on the intraday basis. Since the current situation in the light of the actions of OPEC + No. 2, the problems of Venezuela are still on the buying “side”.