the price of “black gold” standard grades during the evening sale went to decline after the press conference, OPEC+.
By 16:07 GMT August futures for North sea petroleum mix Brent fell by 1.51% to $41,67 per barrel, the July futures on West Texas crude fell 1.9% to $38.8 a barrel. Another Monday morning Brent was $43, and WTI — $40 per barrel, according to PRIME.
the oil Market has lost the optimism after the press conference, OPEC+. Russian energy Minister Alexander Novak and energy Minister of Saudi Arabia Prince Abdul Aziz bin Salman was given to understand that it is early to speak about the possibility of extending the reduction of oil production by OPEC countries+ 9.7 million barrels per day in August.
“as of August, now I think it is premature to make any predictions. We only took the decision in July, we carefully studied the situation on the market. We are seriously monitoring the situation with the recovery of demand as air transport and automotive. And largely this will depend on the situation that will emerge in July — August”, — quotes TASS the head of the Ministry of energy.
According to him, an extension of the current OPEC quota for August will depend on market recovery, oil reserves and commitments of all member countries.
As like an expert on Finance CEX.IO Broker Alexander Anuk, on Saturday “the decision was made to extend the reduction of oil production until the end of July, while the overall quotas to 9.7 million barrels per day”. “Despite the fact that the agreement left Mexico, the situation with the balance of supply and demand will gradually improve. They also found that some countries, such as Iraq and Nigeria, did not fulfill the agreements in may, so they will have to do it during July, August and September,” — said in the review analyst.
the expert on the stock market “BCS” Igor Galaktionov havesuggests that “after approval of the terms of the deal, Saudi Arabia had announced an increase in July prices for its export variety of oil Arab light crude for Asian buyers”.
we Add that since the beginning of this year on the global oil market rode several waves of falling prices for “black gold”. The negative situation caused by a whole complex of factors: a General overproduction of raw materials, a sharp drop in demand due to the rapid spread of coronavirus infection COVID-19 (March 11, was declared a pandemic) and concerns about its impact on the global economy and the collapse of the deal, OPEC+ (officially from April 1, but in fact, after fruitless negotiations of the countries-oil producers at a meeting on March 6 in Vienna). Just last circumstance was the trigger to the collapse in oil prices. Moreover, Saudi Arabia announced plans to increase production and lower oil prices. Later, the desire to lower the prices declared Iraq, Kuwait, UAE and Nigeria.
For the first quarter of 2020, the price of Brent crude fell by 65.6%, while WTI rose by 66.5%. And at the end of March the cost of June futures on Brent fell below $22 per barrel (to $of 21.72), that is, to at least March 2002, and the may futures for WTI to us $20.1.
on April 12 OPEC countries+ finally agreed on a new deal, joined by 23 States. The agreement will be valid for two years, from may 1, 2020 to may 1, 2022-th. In may—June this year, the production cuts will amount to 9.7 million barrels per day (from October 2018), then — until the end of 2020 — 8 million barrels, and 6 million by the end of April 2022. While Russia and Saudi Arabia base count will be 11 million barrels per day (of the Russian Federation in the first 2 months will reduce production at 2.5 million barrels per day). New business OPEC+ was a forced reaction of oil producing countries on the situation in the market and pressure from storoNY USA. Overall, however, it does not cover the volume decline in world demand for the same in the market have accumulated huge reserves of raw materials.
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