So much for the “emergency” OPEC+ meeting. The cartel can’t seem to get Russia to believe there is an oil oversupply emergency even after a 22% price correction in response to demand destruction created by the coronavirus. Russia has delayed agreeing to a proposal by at the joint ministerial technical panel that advises OPEC+ to deepen production cuts by 600,000 barrels per day in response to the virus. Russian Energy Minister Alexander Novak says that the country needs more time to decide which will “maybe” be this week. So hotel operators in Vienna are on edge wondering if they need to block more rooms in response to the OPEC+ non-meeting. OPEC and Russian have to stop meeting like this. News on the virus seems to get worse rather than better.

For markets, the fact that China once again injected billions of dollars of economic stimulus into the system gave the market some stability. Still, it is being reported by Bloomberg that the China death toll from the coronavirus hit 908 with confirmed cases up to 40,171. Yet they also say that the coronavirus may soon peak in Wuhan with 500,000 people infected. More factories are shutting down due to supply chain issues yet others are starting to open. Nissan to suspend output in Kyushu auto plant, Nikkei reports.

The Wall Street Journal reports that China’s smaller companies are particularly vulnerable after coronavirus lockdown that has choked supplies. Reuters is reporting that more than 300 Chinese firms are seeking bank loans totaling at least JPY57.4 billion ($8.2 billion) to soften the impact of the coronavirus outbreak. The firms looking for the cash were either involved in the control of the epidemic or hardest hit by the outbreak situation.

The BBC Writes that, “A large number of China’s factories remain closed today even as millions of people return to work after the Lunar New Year holiday was extended due to the coronavirus. The shutdowns are having a significant impact on the world’s second-largest economy and global supply chains. Some big car makers now face the threat of a shortage of parts. There are also concerns about supplies of Apple (NASDAQ:AAPL) products as the disruptions continue.”

Employers across China were told to remain closed after the annual holiday as part of the attempts by authorities to stem the spread of the virus. For many companies, those restrictions have now been removed, although several significant manufactures remain closed. Foxconn (TW:2354), which is a major supplier to Apple (NASDAQ:AAPL), has yet to reopen its largest Chinese factory. Shenzhen’s Longhua district, where the plant is located, has said production would restart as soon as officials have completed inspections at the facility.

Crude oil is trying to build support below $50. The oil market is hard to position long term and is more of a trade right now. There is a chance that oil bottoms this week but only if some good things happen. Number one would be for OPEC and Russia to agree to a cut. No one cares if they wine and dine in Vienna; the market wants to see a reduction. Number 2, a sense that we know the coronavirus shutdowns start to subside. We need to see signs that China is getting back to normal. If not, it is possible that oil could face another breakdown. Right now 48 dollars should be low-end support. If we break that, especially on a closing basis, we could see $44. If we hold 48 this week and there are no disasters, look to start to position for a long slog recovery rally.

RBOB gasoline looks like its bottoming regardless. Distillates are the weak sister with no real signs of winter.

The oil rig count went up by one last week. Does anybody care? Let me know.