The price of oil: Geopolitics stronger macroeconomic

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As expected, news Agency of energy of the USA has confirmed the decline in crude oil stocks after the previous day about the same decline reported by the American petroleum Institute. The number fell by 11 100 million barrels.
However, trade disputes between the U.S. and China kept the rise in oil prices – weaker economic forecasts undermine demand for energy. As Treasury Secretary Steven Mnuchin not confirmed a planned meeting with the official Chinese representatives next month, is sharply reflected in the commodities market.
Against this background, we can also observe the strengthening of the yen. This in itself is a signal to large investors concerned about the geopolitical tensions. On the other hand, the absence of any news about trade wars is a kind of positive information. American markets took some respite and showed activity in the stock market. Especially, that soon will be celebrated the labour Day, namely, September 2.
But be positive, as we can see, has not affected the oil market. Some stabilization is observed due to the depletion of U.S. reserves by a decline in supply from the OPEC. But this is only a temporary component – it can increase market volatility in one direction or another, but no more.
The primary volatility market can ask the OPEC meeting, which will address new solutions to the question of stabilizing the global oil market. Current steps to revise the quotas are still running, but if the United States will continue to incite trade disputes and supersaturate the global oil market, the OPEC effort can be easily reduced to zero.
In the current environment, Brent crude will trade around $60 per barrel and shale oil WTI will cost $56,12 per barrel in the short term.
Gaidar Hasanov
“International financial center”