Oil: OPEC Influence+ on prices is exhausted, what happens next?

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The price of oil was maintained during the greater part of the 2019 efforts of the Organization of countries-exporters of oil (OPEC) and unaffiliated allies, such as Russia – collectively known as OPEC +, – which pledged to keep approximately 1.2 million barrels per day of supply this year to support the markets. Reduced production in the group of OPEC producers + was the main reason for the sharp recovery after a 38% drop in prices in the last quarter of last year.
In this context, oil prices are likely to move even higher in the second quarter and will average $ 73 per barrel of Brent and $ 65 shale oil WTI. Many large market participants expect OPEC meeting+ to be held in June to discuss whether to continue to hold the delivery or not.
The de facto leader of OPEC, Saudi Arabia is in favour of reduction throughout the year, while Russia, which only reluctantly acceded to the agreement appear to be less interested in keeping the delivery after September. However, reducing OPEC + is not the only reason for the increase in oil prices this year. US sanctions against oil exporters and OPEC members Iran and Venezuela have offered strong support to the global oil market.
But despite this there is still some concern about future demand for oil amid disturbing signs that the world economy may go into recession. The biggest short-term risk for the oil market is likely to be caused by renewed weakness in the stock market. Stock markets have been volatile this year amid signs of a sharp slowdown in the world economy. For this reason, the rise in oil prices is very weak. Nevertheless, in the short term the growth may continue up to $of 68.49 per barrel Brent and $60,30 for shale oil WTI.
__________________ Gaidar Hasanov
Expert
“International financial center”