The previous week started with a 2% drop in oil quotations due to the increase in oil production in Russia and due to Saudi Arabia's cut in the cost of supplying all kinds of oil to Asia.

The spread between the spot price for Dubai oil for the first and third months of the year increased by 55 cents per barrel. In March, the Dubai market was in a state of contango. That is, short-term supplies of this sort cost less than long-term ones. Although most experts expect a uniform reduction in the cost of supplies between all grades of oil, it is believed that Arab Extra Light oil will be sold at a lower discount and Arab Heavy oil will be sold at a lower price.

Meanwhile, in Bahrain, which is the weakest producer among the countries of the Persian Gulf, discovered the largest deposit since 1932. According to the information that appeared in the local media, the new deposit "completely eclipses" all the currently active deposits of the country. According to the Minister of Oil of Bahrain, there are at least 80 billion barrels. The minister added that two consulting companies and the service corporation Halliburton confirmed the assessment of the new Bahrain field of 80 billion barrels. Oil is in the shale rock deep enough beneath the bottom of the Persian Gulf. Now the reserves of Bahrain are estimated at a modest 125 million barrels.

Russian Energy Minister Alexander Novak said that in March Russia fulfilled the OPEC + deal to cut oil production by 93.4%. According to him, incomplete implementation of the agreement is caused by increased production of condensate due to increased gas production, as well as seasonal factors. Since 2017, Moscow has undertaken to reduce oil production by 300 thousand barrels per day, to 11.2 million barrels per day. According to experts, the failure of agreements does not threaten Russia with serious consequences if the country compensates this surplus of production in the coming months.

Saudi Arabia's state-owned oil company Saudi Aramco and French company Total have outlined plans to conclude an agreement to expand its joint oil refinery. The agreement will expand the petrochemical complex in Jubaila, Saudi Arabia. A new hydrocracker plant can also be built. Most likely, the agreement will be signed on Tuesday during the visit of Crown Prince of Saudi Arabia Mohammed bin Salman to France. A 62.5 percent share in the joint venture for oil refining belongs to Saudi Aramco, and 37.5 percent to Total. The companies jointly manage an oil refinery complex with a throughput capacity of 400,000 barrels per day. This complex was launched in 2014 and is considered one of the most technologically advanced plants for the production of fuel and plastics in the world.

The week ended with another decline in oil quotations due to news about a possible increase in duties from the US on goods from China for 100 billion dollars. The cost of June futures for the North Sea oil Brent fell by 0.78% - to 67.81 dollars per barrel, the price of May futures for WTI crude oil was down 0.71% to 63.09 dollars per barrel. President of the United States Donald Trump instructed the country's sales representative to study the possibility of raising duties on goods from China by $ 100 billion on Friday. In early April, the US decided to raise duties on Chinese goods by $ 50 billion. Meanwhile, market participants continued to analyze the news that Saudi Arabia raised oil export prices in May for the Asian region. This step, according to many, indicates that Riyadh in the near future does not want to lift restrictions on oil production

 

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