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Half a year ago, an oil price of $ 30 a barrel would not encourage oil producers. But after the recent dramatic weeks when the crown crisis and market share struggles have brought prices down sharply, oil prices are nearing old and well-known levels on Tuesday.
The spot price for a barrel of North Sea oil, called Brent oil, rises more than eleven percent on Tuesday, and is again above the $ 30 barrel. The spot price is Tuesday night 21, just below $ 31, after having been above this level earlier in the day.
This is the sixth day in a row that the North Sea oil price is rising. At the same time, the price of US light oil, WTI, has risen sharply and has risen 20 percent to $ 24.5 a barrel.
Difficult to analyze
“It is a huge challenge to be an oil analyst these days,” Bjarne Schieldrop begins in the SEB oil comment on Tuesday.
Describes a large gap in the various analysts and estimates of banks on oil demand in the world, and how large it is in relation to production. According to Schieldrop, it is often unclear how much demand is actually in place at any given time, until several months later. Therefore, it is difficult to determine how much demand there was in April.
At the same time, he notes that the main bank Morgan Stanley estimates that the number of barrels of oil stored in April, that is, barrels that were not sent to the market, was 13.4 million per day.
“In that case, the previous estimates are far from correct, and the current market may be close to stabilization,” he writes.
May have deficit in May
Another factor that makes it difficult to say anything about demand in the future is that demand for oil may increase rapidly as the economy grows slowly but surely as crown measures around the world ease.
Schieldrop writes that the increase in oil prices that we have seen in recent days indicates that the market is not completely saturated, as various analyzes and estimates have indicated that it would be. At the same time, OPEC countries with partners (Opec +) have decided to reduce production from May.
Schieldrop believes that these factors could mean that the world oil market may suddenly receive greater demand than supply, and thus achieve stabilization.
Trump is cheering
Among those satisfied with the rise in oil prices is the President of the United States, Donald Trump.
“Oil prices are increasing very well as demand grows,” he writes on Twitter.
Trump was one of the strongest voices for achieving the OPEC + agreement, where OPEC countries with partners cut oil production equivalent to 9.7 million barrels of oil per day.(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.
