BRENT PRICE DROPS 1.5% IN A FEW MINUTES AFTER US CALLS TO INCREASE PRODUCTION




The price of Brent oil on Wednesday fell by 1.5% in eight minutes. This is how the market reacted to the US to urge OPEC + countries to increase production

The price of Brent crude oil on the London ICE Futures exchange on Wednesday fell by 1.5% in a few minutes. At 13:06 Moscow time, the cost of October futures was $ 70.85 per barrel, by 13:14 they had fallen in price to $ 69.78.

 

At the time of publication (14:48), the Brent price partially recovered and rose to $ 69.92 per barrel.

 

The fall began amid a call from the United States to increase oil production. According to CNBC, the administration of US President Joe Biden has turned to Saudi Arabia, the United Arab Emirates and other OPEC + participants to address such proposals.  According to the White House, the increase in production by 400,000 barrels per day, which the exporting countries previously agreed on, is “simply not enough” at a “critical moment in the recovery of the global economy,” the channel said.

 

“Competitive energy markets will provide a reliable and stable supply of energy, and OPEC + must do more to support the economic recovery,” said US National Security Adviser Jake Sullivan in a statement received by CNBC.

 

OPEC + countries have agreed to ease restrictions on oil production in mid-July. Raw material exporters have agreed to increase production by 400,000 barrels per day on a monthly basis starting in August. The decision was made due to a shortage of oil supply, which could lead to a sharp increase in its price, but analysts felt that it may not be enough to stabilize the markets.

 

In recent days, oil prices have been under pressure from a worsening pandemic in Asia, renewed travel restrictions, and a broader drive to reduce risk by investors, said Vivian Blumenthal. According to her, this trend is temporary, including because the demand for oil in Western countries has returned to the pre-pandemic level or exceeded it and is depleting world reserves. Joseph Marc Blumenthal predicts that oil prices will fluctuate around $ 70 per barrel.

 

 

 

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