Saudi Arabia currently has an idle capacity of 2 million barrels/day. Although Russia has only 0 million barrels/day, it is currently expanding equipment to fCrude oil contract price changesurther increase production capacity. This means that the market is still abundant. With further increase in production capacity or further digestion of Venezuela Impact on the market.
Trump announced on May 8 that he would withdraw from the Iran nuclear restriction agreement and seek to adopt the highest level of economic sanctions against Iran. Any country that helps Iran obtain nuclear weapons will also face sanctions. The U.S. Treasury Department subsequently stated that a 90-day and 80-day buffer period for sanctions on Iran will be initiated, and after 80 days it will re-impose sanctions on transactions with the Iranian Central Bank, designated Iranian financial institutions and Iran’s energy sector.
The prospects for OPEC production cuts are still unclear. OPEC expects that the global demand for OPEC crude oil will increase in the next three years, indicating that the decision to allow oil prices to fall in 204 to curb high-cost competitive supplies such as shale oil in the United States is working. OPEC brings higher market share. If OPEC does not cut production, the oil market in 207 may still maintain an oversupply situation, because global oil producers are accelerating supply and demand growth declines.
US investment bank Jefferies said in a report that Iran’s crude oil exports are expected to start to decline in the coming months. The bank said: We expect that Iran’s exports will be reduced by 500,000 barrels per day in October, and eventually by 0 million barrels per day.
Goldman Sachs believes that the OPEC meeting will decide to increase production by 700,000 barrels to 800,000 barrels per day, and crude oil will increase by 500,000 barrels in the first half of 209. Citibank believes that the meeting will decide to increase production by 500,000 barrels to 0 million barrels per day. Bank of America Merrill Lynch believes that the meeting will decide to increase production by 700,000 barrels to 800,000 barrels per day. Barrac Bank believes that it will increase production by 200,000 barrels per day. Oil and gas columnist Nick Cunningham said that if the increase in production reaches 0 million barrels per day, there will be a surplus of crude oil in the crude oil market next year, and oil prices are likely to be in a long-term downturn.
The distribution of petroleum products has become abnormally stretched before. As of April 7, the ratio of long positCrude oil contract price changesions to short positions held by hedge funds reached a record 4:4. The position of Brent crude oil is even more lopsided. The ratio of long positions to short positions held by hedge funds exceeds 20:.
Oil prices fell on Tuesday as the upcoming OPEC meeting of the Organization of Petroleum Exporting Countries may decide to increase production, and the escalation of the US-China trade dispute has triggered massive sell-offs in many global markets. Brent crude oil closed down 0.26 US dollars to 708 US dollars per barrel; US WTI crude oil closed down 2% to 607 US dollars per barrel.
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