Heroes of Ukraine

«Market Leader» - news and previews making you rich.

Tuesday, 23 May 16:29 (GMT -05:00)



Stock and commodities markets

WTI Oil Prices Drop Below $50/b


The cost of the WTI crude oil produced in the United States has dropped below the threshold of 50 dollars per barrel. This is reported to be the lowest price level since December 2016. Strange as it may seem, all of that happened despite the attempts made by the world’s leading oil producers to cut their oil production according to the so-called Vienna Accord aimed at restoring the market balance and push oil prices higher.
 

 

 

 

 

The mentioned price drop took place on March 9. Once again, the price is going down despite the join efforts of OPEC and some non-OPEC members to support crude oil prices and avoid any further weakening. All in all, the current tendency has been underway since March 8 when crude oil got 5% cheaper in a matter of hours. The next trading day, the price dropped 2% more. As for Brent oil, the situation is almost the same, apart from the fact it’s still trading above the $50/b threshold, but pretty close to it though.

At the same time, international experts report that the current tendency is caused mostly by higher oil production in the United States. As for the previous price hikes seen over the last couple of months, they were mostly caused by the mentioned joint efforts of the world’s biggest oil producers. But now the American shale oil industry seems to be reviving and making up for the production cuts seen overseas. The thing is, as the oil prices started recovering, at some point in the past shale oil production became profitable once again, which is why American shale oil companies has been restarting their idle capacities since then. All of that has been happening pretty fast given the relatively low costs. That’s why American oil inventories keep on growing and even seem to be bloated, which cannot but affect the global market of crude oil.

Under such circumstances, all eyes are now on Saudi Arabia and other major oil producers participating in the Vienna Accord. International experts say that at this point they have 2 options to choose from. The first one is all about sticking to the agreement as usual and continue cutting their oil production while yielding a certain share of the global market to American rivals. The second one means quitting the agreement for good and boosting their oil production again while sacrificing the profits by making oil prices drop again in favor of retaining their market share.
 

 

The problem is, the first option still doesn’t guarantee higher oil prices for the mentioned reasons associated with American shale oil. But at the same time, no one seems to believe those “shale interventions” anymore. Everyone seems to look at the actual figures, whether this is OPEC ore American shale oil production. At the same time, we should keep in mind the Iranian factor since Iran hasn’t still joined the agreement officially and keeps on pumping crude oil like never before.

 

You are free to discuss this article here:   forum for traders and investors

 

Add to blog
Got a question? – Ask it here »
 

Don't Anticipate Oil Price Crash, Experts Say

The difficulties with tax reforms in the USA and Saudi Arabia’s stance are expected to support commodity prices, some experts believe. As you know, oil prices have been going down for the last couple of weeks. They even reached the level that used to be prior to the so-called Vienna Accord.

 

 
Publication date: 12 May 12:24 AM

Brent Oil Price May Drop Below $40/B in June

Oil prices have been following a bearish trend over the last few days. International experts believe that if the OPEC doesn’t extend the so-called Vienna Accord, the prices are likely to drop below 40 dollars per barrel in a matter of weeks, if not days.

 

 
Publication date: 11 May 03:53 AM

Brent Oil Prices May Reach $65/b in Q4 2017, Citigroup Predicts

Despite the fact that American oil producers have become more active, the average price of Brent oil has all chances to reach 65 dollars per barrel in the last quarter of 2017, Citigroup experts predict.

 

 
According to the experts, the recent OPEC deal (aimed at reducing oil production and supported by several non-OPEC producers) may well be extended and therefore may become the very factor backing oil prices despite the increasing shale oil production in the United States.
Publication date: 27 April 09:39 AM

Unfavorable Prospects of Russian Oil Production

Despite a range of negative conditions, the Russian oil industry increased its oil production all the way up to another record in 2016. Still, a lot of experts assume that this tendency is likely to reverse in the near future. If that’s the case, the oil production volume in Russia will start dropping.

Publication date: 05 April 08:35 AM

Pro-Kremlin Politicians Keep On Failing In Europe

The Kremlin’s optimism seems to be fading away. The thing is that the amount of pro-Russian politicians in Europe capable of influencing the European politics is shrinking slowly but surely.

Publication date: 05 April 03:11 AM

Brent Oil Drops Below $50/b For The First Time Since November 2016

Today, on March 22, the price of one barrel of Brent oil dropped below $50 for the first time since November 2016. The thing is that crude oil prices crashed almost instantly after another weekly report indicated an increase in U.S. crude oil inventories, Market Leader reports.

 

 
Publication date: 22 March 11:57 AM

OPEC Doesn't Like Russia's Pace of Oil Production Cut

As expected by international experts, the ambitious plan of cutting oil production by OPEC and other oil producers led by Russia are seeing some difficulties during the implementation phase. The OPEC is indicating slower-than-expected oil production cuts in 4 non-OPEC countries participating in the agreement.

 

 

 

Publication date: 19 February 08:29 PM

Mexico & US Cotton Trade Post-NAFTA - Dukascopy TV

2017 is a good year for Cotton farmers.

Louis Rose, President of Risk Analytics

Publication date: 15 February 03:29 AM

«A Trump Weak USD Good For Gold» - Dukascopy TV

Have fundamental drivers for gold changes since Donald Trump gained presidency?

Alasdair Macleod, Gold Money

Publication date: 15 February 03:25 AM

A Macro Insight to Moving Crude Prices - Dukascopy TV

Will Shell producers keep pumping oil?

Chris Kairinos, Rand Merchant Bank

Publication date: 15 February 03:22 AM