The price of Brent crude has collapsed to near 3-week lows

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On Monday, Brent fell to near 3-week lows in the area 74,50, where she met buyers and recovered 100 points, although remained in negative territory, noting the third day in a row of decline. In addition to technical factors, the quotation pressured hints of the leaders of the OPEC deal to a renegotiation of the agreement in the direction of increasing production by 1 million barrels per day in the second half.
Given the significant tightening in the market of black gold, thanks to the efforts of OPEC, and forced the collapse of production in troubled Venezuela and the upcoming sanctions against Iran, the market began to suspect that at some point may form a supply shortage. These assumptions have driven the prices around 80.
However, the signals from Saudi Arabia and Russia, which is quite logical, considering the current situation on the world market, still scared of players who immediately thought of continually increasing activity in the shale deposits of the United States. By the way, now when key exporters have indicated the possibility of the easing of quotas, the market participants will be more sensitive to respond to the statistics coming from the States.
Here bullish signals to expect seems not worth it. Drilling activity continues to increase. Last week the number of oil rigs jumped by 15 pieces. Accordingly, the energy can report a further increase in production, which is inexorably approaching 11 million barrels per day. Thus, recent figures from the U.S. can serve as a catalyst for profit-taking today or tomorrow and send Brent to around 73.
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Michael Mashchenko,
Analyst social network for investors
eToro in Russia and the CIS