the Price of Brent crude oil fell below $ 23 a barrel for the first time since November 2002
silencefoto / DepositPhotos Quotes of this oil has continued to decline and by 10:39 GMT already traded at $22,78 per barrel (-8,6%). The cost of WTI fell by 6.1% to $20,2 per barrel
PirenX / DepositPhotos
the London stock exchange ICE cost of a barrel of Brent crude oil fell to 8.34%, to $of 22.84 per barrel. This is evidenced by the auction at 10:37, referenced RBC. The last time the price of Brent crude was at this level in November 2002.
Quotes of this oil has continued to decline and by 10:39 GMT already traded at $22,78 per barrel (-8,6%). The cost of WTI fell by 6.1% to $20,2 per barrel.
against the background of falling oil prices the Russian ruble weakened against the U.S. dollar and the Euro. So, the dollar during trading on the Moscow exchange is at the level of 80.1 ruble (+1.6 percent), and the Euro – 88,7 Rthe son of a (+1,1%).
According to experts, the dynamics of the commodity market was affected by increased fears of falling demand, a further decline in the may crude oil futures may continue. In the absence of any positive news they will continue to move in the range of $20-24 per barrel.
last week the oil price has twice tested the level of $30 per barrel. But, according to the analyst, “freedom Finance” Valery Yemelyanov, the market of raw materials is mostly already priced in the current price all main negative, including the possible failure of the demand for oil by about 20% of global consumption of raw materials in the next several weeks.
With the beginning of the month the cost of Brent crude oil has fallen by more than 50%. The demand for oil has been falling since the beginning of the year due to the spread of coronavirus and quarantine measures in the world. An additional negative impact on prices in early March have been news that the parties to the transaction to restrict production OPEC+ are unable to reach a unanimous decision concerning the future regulation of the production of raw materials.
Now, the largest oil producer is the United States. Oil production in this country amounts to about 13 million barrels per day. Saudi Arabia in a deal on production cuts between OPEC countries have produced in the first quarter of 2020, 9.7 million barrels per day. From 1 April, Saudi Arabia plans to increase oil supplies to the world market to 12.3 million barrels a day.
28 March Bloomberg reported that the U.S. oil market stopped to have a price – the demand for it has fallen to such a level that some producers are willing to pay to have the oil taken from their storage. Company Wyoming Asphalt Sour was the first to set a negative price of oil, and Mercuria Energy Group Ltd in mid-March announced that it will pay 19 cents for each barrel of crude oil, towhich will take out of her tank.
According to the analyst, ESAI Energy, the extraction of oil removed from the sea ports it is difficult to convey to consumers. She also explained that there where storages filled quickly, the prices can go into minus. Oil traders believe that the negative cost of oil will soon become an everyday event, as refineries reduce the amount of processed oil.
Among the North American oil brands, whose prices are already close to zero – the canadian Western Select. On Friday the price fell to $5 per barrel. Brent Southern Green Canyon trading at $11 per barrel and Oklahoma Sour – $5,7, Wyoming Sweet – $3 per barrel.
Some countries have already imposed a moratorium on oil imports to only use raw materials mined in the state. Did, for example, Pakistan, the ban on 26 March, the imports of oil and fuel, because its storage is full.
the World is already on the verge of exhaustion of free space to store unclaimed oil. Somewhere this is already happening, and all it touches is in the next couple of months.
the Current falling demand and excess supply mean that oil reserves will increase by 1.8 billion barrels after the first half of 2020. I’m still only about 1.6 billion barrels of storage capacity. Crude oil will have nowhere to put. In the end the prey will not just reduce but to stop.
According to the analysis of the consulting company IHS, Markit, Russia as one of the three largest world producers of oil has the least amount of available storage is approximately eight days. These figures are based on the volume of production that can be saved if the export runs out. Saudi Arabia has in reserve for 18 days and the US for 30 days.
