Last week began with an increase in oil prices by 1.55%, to $ 31.44 per barrel.

Oil prices went up after Reuters reported that Saudi Arabia reduced oil production by 1 million barrels per day in excess of the agreed reduction under the OPEC + deal. The corresponding instruction of the oil company Saudi Aramco was transferred to the country's Ministry of Energy. The overall decline in production by Saudi Arabia will be 4.8 million barrels per day from the April level. According to the terms of the deal, in June oil production in the kingdom will be 7.492 million barrels per day.

The United States, meanwhile, is experiencing the largest decline in drilling rigs in history due to the coronavirus pandemic. The total number of horizontal oil rigs fell in the country in April below 270 or by 57% lower compared to the peak in 624 rigs in March 2020. Last week the number of oil rigs in the country dropped to 70, which is 54% lower than the previous peak observed in June 2019. Experts believe that the bottom of the cuts has not yet been achieved, but the peak rate of decline in both absolute and percentage terms has already been passed.

In the middle of the week, OPEC issued a new forecast, which, according to the results of 2020, is expected to drop in demand by 9.07 million barrels per day, which is 2.23 million barrels higher than the previous forecast. In particular, the forecast for a decline in oil demand in OECD countries has deteriorated by 1.2 million barrels per day; in countries outside the OECD, by 1.03 million barrels per day. Thus, global demand for oil in 2020 is expected to reach 91.1 million barrels per day. According to OPEC, the largest drop in demand in the world's largest oil consumers will manifest itself in the second quarter of 2020.

At the same time, the International Energy Agency (IEA) improved its forecast for recovery of the oil market. At the end of March, the IEA expected a drop in demand of 9.3 million barrels per day. But the estimate is improved by 0.7 million barrels per day due to the removal of quarantine restrictions in different countries and the resumption of production, trade and transportation. At the beginning of the pandemic, 4 billion people were under restrictions, and by the end of May, according to the forecast, only 2.8 billion people will remain in quarantine. IEA expects stabilization of the situation in the second half of 2020.

At the end of the week, OPEC Secretary General Mohammed Barkindo on Bloomberg TV made a rather optimistic statement that world oil production is declining rapidly due to the implementation of the OPEC + deal, in which the alliance countries are consistently cutting production, as well as stopping production projects from due to poor pricing in other countries. These factors make it possible to talk about the end of the most difficult period of the crisis in the oil market. . According to OPEC, the total reduction in production, taking into account the OPEC + deal and the natural shutdown of wells in the world, reaches 17.2 million bps. Of this volume, 3.6 million bpd is accounted for by production cuts in countries not participating in the agreed production cuts. Barkindo also noted that at the OPEC + ministerial meeting scheduled for June 9-10, “all scenarios will be considered” on the levels of reduction after June, taking into account the state of demand at that time.

 

Company news

16.04.2020 Switching to floating spreads Read more ...
16.04.2020 PC terminal stops Read more ...
10.04.2020 Changes in trading conditions for CFD-instruments for US securities Read more ...
10.04.2020 Temporary closing of trading on a number of instruments Read more ...
10.04.2020 CFD on RF securities stop Read more ...
Show all

Expert view

31.05.2020 Stock market to recover Read more ...
31.05.2020 Roller-coaster at the world oil market Read more ...
24.05.2020 Stock market to recover Read more ...
24.05.2020 Shale oil production to go down sharply Read more ...
17.05.2020 Uneasy week for US stock market Read more ...
Show all

The payment services are provided by Cauri LTD, 20-22 Wenlock Road, London, N1 7GU, UK, registered number 09507138
(check https://register.fca.org.uk), Win Pay (check http://win-pay.biz).

RISK WARNING STATEMENT. TO ATTENTION OF TRADERS AND INVESTORS!

Our services include products that are traded on margin and carry a risk that you can lose more than your initial deposit. The products may not be suitable for everyone - please ensure you fully understand the risks involved. There is a high level of risk involved with trading leveraged products such as forex and CFDs. You should not risk more than you can afford to lose, it is possible that you may lose more than your initial investment. You should not trade unless you fully understand the true extent of your exposure to the risk of loss. When trading, you must always take into consideration your level of experience. It is the responsibility of the Client to ensure that the Client can accept the Services and/or enter into the Transactions in the country in which the Client is resident. If the risks involved seem unclear to you, please seek independent advice.

 

CLIENT AGREEMENT PDF
PRIVACY POLICY PDF
RISK DISCLOSURE STATEMENT PDF
REFUND AND RETURN POLICY
AML&KYC POLICIES PDF
KYT POLICY PDF
FRAUD VERIFICATION PROCEDURE PDF
REGULATIONS OF TRADING PDF
RESPONSIBLE ATTITUDE