Brent oil futures fell to the lowest level since July-2017
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oil Prices fell almost 5% after the information that Russia can only agree with the extension of the deal, OPEC+ on current conditions, but against additional cuts in the production of coronavirus.
as of 13:42 GMT may futures for North sea petroleum mix Brent has fallen by $4.78% to $47,6 per barrel, the April futures for West Texas crude fell by 4.58% to $43,8 per barrel. Minutes earlier, the drop in prices reached 5.6 percent, according to PRIME. Thus, the quotes of Brent fell to the lowest level since July of 2017.
Previously a senior Agency Reuters stated that Russian authorities agree to extend the validity of previously concluded agreements on the reduction of oil production, but will not go on further reduction.
As like an expert on the stock market “BCS” Igor Galaktionov, before oil prices fell in the Wake of continued uncertainty over OPEC deal+ after 1 April 2020. During the day in the media there was a large amount of rumors and speculation about what level of reductions can be approved. In the official press release on the website of OPEC, it is reported that the members of the cartel decided to recommend an additional reduction of 1.5 million barrels per day not only for the period of the II quarter, but the entire 2020. The share of the countries of non-OPEC can be allocated 500 thousand barrels per day of this amount.
So, the parties have been unable to agree on a further reduction of the total quotas for oil. This issue will be solved before the end of the day. On the other hand, Russia has previously said that he prefers a wait and see attitude, refusing the more urgent the February meeting of the OPEC+. According to experts, if the group was not able to agree on the measures of support for the two-day meeting, it will be a real blow to the oil market. However, traders do not consider such a scenario as the base and hope that eventually Russia will join their allies.
“We are a key player along with Saudi Arabia. And there was no agreement that we will continue to monitor the volumes of oil supplies to foreign markets”, – said Finance Minister Anton Siluanov, commenting on the situation. His words leads RIA “Novosti”.
“This may cause the volumes of oil will increase, prices will fall. But we were prepared for this: we created the reserves and the national welfare Fund, which was filled by reserves and oil revenues in the so-called “fat years”, – the Minister added.
Siluanov said that many criticized the Finance Ministry for what he “sits on her lover and pines,” reserving the national welfare Fund revenues from high oil prices. “But may now change the situation and we will be at the expense of the capsule to the Finance charges that we took in which we have obligations”, – said the Minister.