Monday , April 12 2021

Donald Trump is guilty – the fall in oil prices may have been overreactive



(Hegnar.no): on Tuesday, oil prices fell for 12 consecutive days. It has never happened before.

On Wednesday morning, the price of oil recovered slightly, but at the lowest in the night trading, American light oil went to $ 54.75, down 28.6 percent from the peak of $ 76.72 on October 3rd.

Brent fell 24.6 percent from the same day to $ 65.01.

Therefore, oil prices collapsed

The fall in the price of oil is due to the fact that the fall in oil prices has increased, but production growth and future expected consumption have declined. The fact that sanctions on Iran, introduced on November 4, were laid-back before the Middle East, so large oil import countries such as Japan and China could continue to acquire oil in Iran during the year has also been a strong factor.

The war of trade is also a source of fears about the deteriorating global economic growth and hence the expectations of a decline in oil demand.

It is also said that speculative positions have changed faster than ever and that it has almost been a panic store. Oil expert has not seen a couple in the 35-year industry.

Also read: – There is some kind of confusion and schizophrenia on the market

And as oil prices rose slightly on Monday after Saudi Arabia and OPEC had suggested that they decided to cut production at a meeting on 6 December, President Donald Trump withdrew from Twitter and thought it was a bad idea and that oil prices should be lower, on the basis of a large offer.

The price of oil fell again and dropped by 6 to 7 per cent.

"The reason for the drop in prices was Twitter's message to Trump, which came very surprising," said Trond Omdal, who has been the Chief Financial Officer of Fearnley Securities for the Eearns (Oil and Gas Investments) since May, Hegnar.noon

He adds that he feels Trump and the United States want oil prices of $ 65-70, while Saudi Arabia wants it to be $ 80-85.

"There is a compromise between the two, but I believe that the stage is a little closer to Saudi Arabia's willingness than the United States," Omdal said.

Importance of oil price

OIL REPAIR: Fearnley Securities Oil Specialist Trond Omdal gives Donald Trump blame for the fall in oil prices on Monday and Tuesday. Photo: Kyrre Lien / Scanpix
Oil price: Oil expert Trond Omdal Fearnley Securities gives Donald Trump blame for the fall in oil prices on Monday and Tuesday. Photo: Kyrre Lien / Scanpix
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Oil prices are important because the state budget is largely dependent on the price of oil so that it is a decent win and that the oil fund is given more money.

Revenues from the state budget of 2019 are estimated at NOK 312.8 billion, which represents 21.9 percent of the total state budget of 1,430.4 billion Norwegian State budgets.

The overall result is estimated to be NOK 279 billion, which is NOK 141.3 billion this year. It is 50.4 and 97.5 percent more than the government now thinks of this year. But everything depends on the price of oil.

The government's state budget for 2019 has assumed an oil price of NOK 583. When the budget was presented on October 8, SEK 690 was a dish. The night to Wednesday fell to SEK 554.

Also read: The three main chapters of the state budget

Offer and demand

The OPEC average crude oil production is estimated to be 32.90 million barrels per day in October 2018 – 127 000 barrels a day more than the previous month.

Demand for global oil in 2018 is estimated to be 98.79 million barrels a day, the same as in the previous report.

Growth in demand from 2017 to 2018 is now being said to be 1.5 million barrels a day, which is equivalent to a marginally downward adjustment.

The biggest donors are mainly the US and China, but also India.

OPEC's oil demand is estimated at 32.59 million barrels per day in 2018, which is equivalent to a 10,000 barrel reduction from the previous report.

Demand for global oil in 2019 is estimated to be 100.08 million barrels a day, reducing 70,000 barrels of the previous report.

In this case, we are talking about rising demand from 2018 to 2019, to 1.29 million barrels a day, which is equivalent to a 70,000 barrel decline.

OPEC oil demand is estimated to be 31.54 million barrels a day in 2019, which is equivalent to a 30,000 barrel reduction from the previous report.

The offer is good

At the same time OPEC (non OPEC) 2018 production yielded up to 59.86 million barrels a day.

This corresponds to 90,000 barrels a day upwards compared to the previous report.

At the same time, 59.86 million barrels a day will grow 2.31 million barrels per day compared to 2017.

In the previous report, production growth outside OPEC was estimated at 2.22 million barrels per day.

The 2019 output of OPEC (not OPEC) is now estimated at 62.09 million barrels per day.

This corresponds to 200,000 barrels a day upwards compared to the previous report.

Forecasts are revised despite forecasts from Canada, Mexico, Brazil and China.

62.09 million barrels a day corresponds to 2.23 million barrels a day compared to 2018.

In the previous report, production growth outside OPEC was estimated at 2.12 million barrels per day.

USA, Brazil, Canada and the United Kingdom are the most important growth companies, while Mexico, Norway, Indonesia and Vietnam are expected to be the most successful.

USA sacrifices

Of the 2019 forecast, 2.23 million barrels a day, the United States is estimated to grow 1.69 million barrels a day.

Thus, a total of 310,000 barrels of 1.38 million barrels a day have been used in the previous report.

By 2019, US total output is estimated to be 18.15 million barrels per day, of which 12.06 million barrels of crude oil.

As a result, thin oil production is estimated at 7.36 million barrels a day in 2019, when it will be 1.17 million barrels a day since 2018.

According to OPEC, this output will mainly benefit from 3.41 million Permian barrels, 1.47 million Eagle Ford barrels and Bakken's 1.44 million barrels.

The production of American slate oil is growing at OPEC's clearest headache and has deteriorated last month.

Saudi coverage of Iranian cases

According to estimates from other sources, OPEC's production in October 2018 was 32.90 million barrels a day, rising from 127,000 barrels since September.

The United Arab Emirates's production grew most: 142,000 barrels a day to 3.16 million barrels a day.

Saudi Arabia dropped its production by 127,000 barrels to 10.63 million barrels a day.

In Libya, production grew by 60,000 barrels to 1,114 million barrels a day, while Angola and Qatar produced more.

Due to US sanctions in Iran, it is no wonder that production fell most, or 156,000 barrels a day, to 3,296 million barrels.

Oil price rises again?

Tonight Brent oil fell to $ 65.01, but on Wednesday morning it will grow $ 1.2 – $ 66.64. American light oil will grow 60 cents to $ 56.29.

The price of oil has recovered again a little on Wednesday morning.

"Although the oil market has now reached a balance, the 2019 forecast shows growth outside OPEC, which is higher than the rise in world oil demand, leading to increased market gains," the report says.

The figures therefore emphasize why Saudi Arabia and other OPEC members talk about reducing production and, according to Bloomberg, confirm the accusation of significant production by cutting off at the OPEC meeting in Vienna on 6 December.

According to the news agency, OPEC Secretary-General Mohammad Barkindo announced on Monday that OPEC's production outside has begun to appear alarming.

He now sees that OPEC and their allies are outside the organization to agree that production will cut a million barrels a day at that Vienna meeting.

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