Crude Pressure?

The world has adequate supplies of crude oil despite OPEC’s recent assessment that market for crude will be undersupplied by ~0.4 million barrels per day in 2018. U.S. crude production climbed in March to 10.47 million barrels per day, a monthly record, data from the Energy Information Administration shows and U.S. drillers continue to add rigs reaching the highest levels of activity since early in 2015. On paper at least, the world is still oversupplied and prices should be falling. However, geopolitical uncertainty and events are setting up for pressure on crude prices despite President Trump’s tweeting about OPEC and high prices. Perhaps the most significant impact is the Trump administrations return to sanctions on Iran. According to the State Department, companies buying Iranian crude must cut all exports by November or themselves face sanctions. This news has already been conveyed to European countries and pressure will certainly be applied to China, India and Turkey in the coming months to comply. This could effectively remove 2m b/d from the market. Meanwhile, Russia and OPEC have started to ease restrictions on production and OPEC has agreed to raise production by an indeterminate amount. However, there are other factors at work including… continue reading

Continue reading Crude Pressure?. This article appeared first on CTRM Center.

Source: CTRM Center

Related Posts

Leave a reply