Oil price Fall will resume transactions with China will not
Despite the fact that global oil prices played a fall by 5.8%, the pressure on the black gold will continue indefinitely. Largest oil producer Saudi Aramco due to the low prices recorded a decline in net profit by 12% in the first half. Saudi Arabia can no longer continue to tolerate oil prices below $65 per barrel and generate a negative balance its budget.
However, until you have taken the response of OPEC countries, concerns about falling global demand for energy because of the trade wars will pull oil prices down.
It became known that Donald trump is not going to make a deal with China and does not want to conduct is scheduled for September us-China negotiations. This position of the President of the United States undermines global markets and brings the country to a possible global recession against the backdrop of ongoing trade wars and sanctions policy of Washington.
On world markets there is uncertainty regarding the possible settlement of commercial demand. Major parties try to be in the cache and to observe the development of the geopolitical situation, and when to purchase a protective assets such as gold.
Tomorrow, OPEC will release a monthly report, where will be discussed the prospects of the world oil market and the analysis of factors affecting supply and demand. Now the only option for stabilizing the global market to be considered a strategy to increase quotas for oil production.
The US is actively increasing production of shale oil, gradually capturing a share of the world oil market. In this regard, the price of oil, even though they are corrected in a positive way are more likely to continue to decline. Brent may fall to $57,13 per barrel and shale oil WTI to $52,92 per barrel.
“International financial center”