Print oil Prices soared to 4%. A barrel of Brent now costs more than $ 49, and a barrel of West Texas is of $ 48.70. The main intrigue in the market – the upcoming 30 November OPEC summit, which the members of the cartel must make the decision to freeze production.
the closer the deadline the more optimistic seem to be statements. Over the weekend, OPEC Secretary General Mohammed Barkindo visited Tehran, where he held new consultations with Iran, and now the position of the Islamic Republic does not look so hopeless. Oil Minister of Iran, Mr. Zanganeh has assessed the likelihood of consensus within OPEC as very high.
moreover, according to the available information, it is more tractable and has become Iraq.
the Moment of truth is approaching, and, apparently, the parties do come to an agreement. This is evidenced by the market reaction. Oil futures, which until recently the stone fell down, now again approaching the key $ 50 per barrel.
by the Way, the chart formed a reversal pattern “head and shoulders”.
If the largest oil-producing countries will indeed limit production, according to experts, the demand will only grow.
Alexander Losev, General Director of “SPUTNIK – CAPITAL MANAGEMENT”
“Daily demand for oil is projected at 1.4 million barrels higher than this. Because the world economy is not falling, China growing by 6.5%, India by 7%. Consumption in the US grows. When we talk about shale oil, it is not necessary to forget that America is only 40% self-sufficient with its own oil”.
In the end, the balance of supply and demand will occur in the I or II blocks 2017, and then a deficit.
Alexander Losev, General Director of “SPUTNIK – CAPITAL MANAGEMENT”
“first We will see the balance. Now a surplus of already less than 1 million barrels per day, according to IEA. Balance will be achieved in the first quarter, maybe the second”.
as for OPEC, turning back the cartel is just not there – will have to negotiate. The fact that in recent years, the organization has almost completely lost its credibility. Not only that the participating countries have not complied with the quotas, and any attempt to negotiate each time ended in failure, so that another failure would mean the end of OPEC. In the end, will have to negotiate, and higher oil prices will play all.
Another issue is that in this scenario will increase the production of shale oil in the United States. In addition, the new President of the USA Donald trump Monday announced the intention to remove the various restrictions on the extraction of hydrocarbons on the first day after the inauguration. Meanwhile, the American kancevica for several months now, actively increase the number of drilling rigs according to Baker Hughes, the rig count in the United States is now at the highest since Jan.
Zerohedge
But this factor may not exert particular pressure on prices. Despite the modernization of the production process, lower costs, shale companies has slowed. And production remains profitable at $ 50.
Categories: Oil, Futures, Russia, World
Tagged: WTI, brent, Iraq, Iran, OPEC, drilling, mining, frost, oil
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