Pointing to the economic crisis of 2008 leading to the volatility of oil prices, ICOFC official said “the cause is that oil is not a commodity and many factors are involved in its purchase due to having influence on all security, economic and political areas, which imposes the maximum risk on oil prices”.
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“Almost the entirety of added supplies in 2016 will come from Iran, Iraq and Saudi”, it said.
There is “absolutely no chance” the country won’t step up production, Iran’s deputy oil minister said overnight.
In the next two weeks, Japan, South Korea and Russian Federation will see milder than normal temperatures for this time of year while the US, Canada and Europe will be “particularly” milder than normal, according to a note from BNP Paribas published Monday. The country now exports 1.1 million barrels per day.
Analysts say oil prices will remain lower for longer as the refusal by the Organization of the Petroleum Exporting Countries to curb production is being compounded by an expected increase in supply from Iran and Libya.
Year to date, the ICE U.S. Dollar Index has gained by more than 8%, while WTI oil prices are set for a loss of more than 30%. Meanwhile, the United States benchmark West Texas Intermediate fell below US$35 a barrel early Monday. Light Louisiana Sweet, a similar grade of crude sold on the Gulf Coast, traded at 35 cents a barrel more than Brent.
The WTI Crude Oil market continued to fall on Friday, as this market simply can not find any type of support.
The group has been pumping near record levels since past year in an attempt to drive higher-cost producers such as USA shale firms out of the market.
“These so-called “petro-dollars” have disappeared as fast as oil exporters’ current account surpluses have melted over the last twelve months – from $500bn in 2013 to less than $50bn this year”. Moreover, data from the Commodity Futures Trading Commission showed that hedge funds had increased their bets on further downside in crude oil prices, to an all-time high.
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OPEC, which chose not to cut output at a December 4 meeting, is displaying hardened resolve to maintain sales, the IEA said in its monthly report Friday. “If there’s a draw, I think you’d expect to see a stronger short-covering rally”, he said. All of these markets are suffering from the same thing, a glut in global supply when it comes to the oil markets. The plunge in oil prices, which has been spurred by excess global supplies, continues to be a drag on inflation, which raises doubts about further action from the Fed. Futures fell as much as 5.5% to $1.881 per million British thermal units on the Nymex.
