As the world began to lift the restrictions imposed by the spread of the Corona virus, the demand for oil began to increase gradually, which prompted the OPEC Plus parties to raise production to 45.5 million barrels per day instead of 43.8 million.
Following the agreement, oil prices recorded losses due to expectations of increased production, according to Reuters, as Brent crude closed at $68.62 a barrel, losing $4.97, and US oil futures settled at $66.42, down $5.39.
However, even with this loss, Goldman Sachs raised its forecast for oil prices in the coming months, returning that the market will "remain in a deficit" and in need of oil products, because the increase is "moderate".
The bank expected the price of Brent crude to reach $80 a barrel this summer, compared to just over $68 now.
And Saudi Arabia announced, through its Minister of Energy, Prince Abdulaziz bin Salman, to work to end the current levels of reduction in oil production by the end of September of 2022 “if oil market conditions allow.”
This announcement by Saudi Arabia comes after the national oil companies in the OPEC + group went to determine the prices of their oils, as Saudi Aramco raised the price of “Arab Super Light” by one dollar per barrel, and also raised other grades of the product by 0.8 dollars per barrel over the course of the month.
Saudi tendency to raise prices
The Oil Price website, which specializes in economics and oil affairs, says that "strange" in such a move is the failure to distinguish between lighter and heavier grades of crude oil.
The Saudi price hike is in line with other regional positions of major producers such as Iraq and Russia.
The site added that "as soon as Saudi Aramco set the general course of pricing in the Middle East in August, the Iraqi company SOMO raised the prices of its oil destined for Asia by 80 cents a barrel for Basra Light and Medium crudes, and raised Basra Heavy oil by 75 cents a barrel, higher than the prices of Basra Heavy crudes. Kirkuk is the least rich.
The site said that, "Despite all the turmoil this month witnessed, everything has returned to its "correct" place, as OPEC Plus continues to "control the supply of crude oil, and Saudi Arabia has maintained discipline within the organization."
Reuters says that Saudi Arabia and the UAE, who differed over production and reached an agreement recently, are "happy" with what is happening, without revealing the details of their agreement, which ended a potential crisis between two producing giants in the region.
Dubai was objecting to Riyadh's idea of extending the agreement to reduce oil production until December 2022, to maintain pressure on the market, and wanted a higher production quota, which Saudi Arabia was rejecting.
The new agreement allows the UAE to raise its production by approximately 300,000 barrels per day, to reach 3.5 million barrels per day, while Iraq and Kuwait will add 150,000 barrels each per day, and Saudi Arabia and Russia will raise their production to 11.5 million barrels per day, instead of 11 million.
The Saudi Energy Minister said that OPEC Plus will adjust its policy "in case the sanctions on Iran are lifted," which specialists expect to be able to export 1.5 million barrels per day once sanctions are lifted.
In general, the world seemed "happy" to reach an agreement, even though it was "not enough", according to the New York Times, which quoted, Gary Ross, CEO of Black Gold Investors for oil trading, that "the United States should be very happy with the agreement." , after the arrival of gasoline and oil prices to high levels.
After reducing production by about 10 million barrels per day last year, production increased in the countries of the group, but it is still lower by about 5.8 million barrels per day than it was before the epidemic.
No comments:
Post a Comment