Saturday , June 19 2021

The price of oil consumed by global insecurity

The international oil price has fallen to close to 7%, largely explained by the expectation that a possible oil production reduction from the Oil Countries Organization (OPEC) will be enough to halt the increase in global supply.

The oil market also responded negatively to raising investors' concerns about the perception of lower world economic growth after the trade war between the United States and China.

The reference oil, West Texas Intermediate (WTI), fell from $ 6.59 to $ 53.43 per barrel in Brent's crude North Sea operation, followed by the same behavior, representing a fall of 6.38% to 62.53 dollars per barrel. Mexican blend has recorded a loss of 3.53% to $ 58.50 per barrel.

Donald Trump, who last week made the United States President in connection with the criticisms he had given Saudi Arabia over the intent to reduce production, the international price of oil further deepened.

"We hope that Saudi Arabia and the Organization of Petroleum Exporting Countries (OPEC) will not cut off oil production, prices should be considerably lower on the basis of bids," Trump said on Twitter.

In this context, WTI is down by 29.04% for nearly eight weeks, an equivalent drop of $ 21.87 after moving from $ 75.30 to $ 53.43 per barrel, while Brent reports a contraction of 26, 42% and Mexican exports of crude oil, down 23.37% over the same period.

Analyst of the Banco Base Energy Sector, Ana Azuara, noted that OPEC noted that, in order to avoid excessive supply in the market, the cartel must maintain a common oil production of 31.5 million barrels per day, so it should reduce production by 1, 4 million barrels a day.

Bank analyst Monterrey said a reduction in crude oil was recorded temporarily, as there is a forecast that by the end of this year, WTI offers could return to $ 65 a barrel.

The expert has mentioned that the oil has a $ 50 per barrel support, so when it exceeds, the next target price would be $ 45 per barrel.

Banore-Ixe energy sector analyst Santiago Leal stressed that crude oil would finally start in the coming weeks, as the current drop in crude oil prices is the result of speculative operations.

The expert expects that in the last month of this year the oil market will show a jump, predicting that Brent North Sea oil will show the price close to $ 80 per barrel.

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