[ad_1]
Overnight, North Sea oil (burned place) fell from $ 20.3 to $ 16.9 per barrel, the lowest level since 1999.
Thus, the dramatic drop in oil prices continues, and North Sea oil has fallen more than 40 percent so far this week.
Oil prices have never dropped so much in a week before in modern times.
Joachim Bernhardsen, an analyst at Nordea Markets, writes in his morning report that the movements in the oil market show that the negative prices we saw in US light oil on Monday were more than a technical failure.
– The market is in serious imbalance. Opec + has reduced production by about 10 million barrels per day, but this will only take effect on May 1. Until then, overproduction can be as high as 30 million barrels per day, writes Bernhardsen.
Stocks were completed in one to two months.
As a result, oil reserves are filling up rapidly, which is about to sink in the market.
– In the USA In the USA, where we have the best data, the storage capacity can be filled in one or two months. The situation is probably the same for the rest of the world. If this continues, there simply will be no place to make oil for a while. If we get there, the prices are still too high, he continues.
Stock market provider ICE has delivered spot prices for North Sea oil since 1986. During this period, oil prices have never fallen as much as 40 percent in a week.
June contracts are $ 23.3, but they are also one dollar lower than when the Asian markets opened.
Investment bank Raymond James believes that the collapse in prices and the probability of negative oil prices in the United States will continue in May when the June contracts are liquidated. Contracts for US oil deliveries in June are $ 12.7 a barrel.
“Prices will continue to be very low”
Financial institution Goldman Sachs believes that oil production in the United States could drop several million barrels per day in the coming weeks to create some kind of balance in the market.
John Browne, who was chief executive of BP (formerly British Petroleum) from 1995 to 2007, tells the BBC that the situation in the oil market has many points in common with what happened in the mid-1980s when overproduction led to oil prices staying low for 17 years. .
– Prices will remain very low, and I think they will remain low and very volatile, for a considerable period. Oil that is stored and still not being used is still being produced, he told the BBC on Tuesday.
Stock markets try to take a breather
Asian stock exchanges have tried to find a foothold, but on Wednesday morning there is a big decline across the region.
– It seems that the markets are taking a breather after the previous rise. Much of what is happening now is due to the deep and historic collapse of the oil price. This has been largely the catalyst that has fueled already fragile market sentiment, says Candice Bangsund, portfolio manager at Fiera Capital to Bloomberg.
Capital Economics believes there will be a series of further cuts in interest rates in Asia next week, probably also in Japan, where there are already negative interest rates.(Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We want you to share our cases using a link, which links directly to our pages. Copying or any other use of all or part of the content may only be made with written permission or as permitted by law. For more terms see here.
