After the claim of the President of the United States Brent crude have fallen by more than 2.5%.
The President of the United States Donald trump interrupted for nearly three months silence on the situation in the oil market and renewed his twitter attack on OPEC, accusing the cartel again in overstating the value of “black gold”, reports finanz.ru.
“Oil prices become too high. OPEC should relax and not try so hard,” wrote trump on Monday, clearly alluding to the transaction to reduce production, which Saudi Arabia and its middle Eastern partners and Russia was renewed in December, agreeing to remove from the market the 1.2 million barrels of daily supply.
In the framework of this agreement the Saudi national oil company Saudi Aramco in December reduced production at 459 thousand barrels per day in January stopped capacity even 350 thousand barrels, and by February will reduce production to the minimum in 2016 9.8 million barrels per day, promised Minister of energy of the Kingdom , Khaled al-falih two weeks ago.
According to the source WSJ, the informal goal of these efforts is the increase in prices to $ 80 per barrel, this level Moscow and Riyadh agreed on at the December talks in Vienna.
But, according to trump, these prices the world economy is not needed. The world is too “fragile”, he wrote, “cannot bear the increasing cost” of oil.
The market reacted to the tweet trump immediate price drop. A little more than an hour futures on the mark Brent in London dived to 1.88 dollars, or 2.8% – of 62.25 per barrel, its lowest level in 10 days.
The fall on the stock exchange NYMEX in new York reached 2.7% 57,43 to 55.7 per barrel of the American benchmark WTI.
Regardless of trump’s tweets to oil prices will be difficult to rise above current levels: deterioration in the global economy was the main negative factor for the market, indicates commodity strategist at Sberbank CIB Mikhail Sabe.
China’s economy is the world’s largest importer of “black gold” procuring every tenth barrel, which is mined on the planet – by the end of 2018 showed a minimum during the 28 years of growth (6.4 percent), which was accompanied by a sharp 4.4% decline in the dollar export revenues in December, which could not influence the ability of China to purchase raw materials.
In Europe in technical recession rolled Italy, showed a decline in GDP for two consecutive quarters, and Germany escaped it by a miracle: GDP fell by 0.2% in the third quarter and showed zero growth in the fourth.
In January the index of business activity in industry of Germany (PMI) fell below 50 points – the features that separates growth from contraction, while France is deeply in the negative (47.7) went a combined PMI for the economy.
In 2019 the GDP of Germany fell to 1.1%, France 1.3%, and Italy – will amount to a meager 0.2 percent, according to the forecasts of the European Commission.
To the extent that global demand remains in question, the volume of oil production in the US are growing: last week, the States became the first country in the world, traded the bar at 12 million barrels daily production.
The export of American oil to the world market reached 3.6 million barrels per day. By this measure, the United States overtook and came in fourth place in the world, behind only Russia (5.2 million barrels per day) and ahead of all OPEC countries, except two of Saudi Arabia (6.9 million barrels per day) and Iraq (3.8 million barrels).
The market lives expectations for the trade deal that trump will sign with China, but even positive signals from negotiations and the willingness of the States to postpone scheduled for March 1 introduction of the total fees is clearly not the end of tensions between the two countries, says the economist Oxford Economics Louis Kuis.
“It will be difficult to agree on the terms “monitoring and implementation” on which insist the USA, but who doesn’t like China. Tensions due to technology, industrial policy of China and, more broadly, the rise of China, are unlikely to disappear any time soon,” says Kois.