During the trading session on November 6, the price of Brent oil sometimes rose to 86.06 USD/barrel, while the price of WTI oil reached 81.6 USD/barrel. Saudi Arabia’s energy ministry earlier confirmed it would continue additional voluntary production cuts of 1 million b/d until the end of the year, meaning the country’s December output stands at about 9 million b/d.
A source at the Saudi Arabian Energy Ministry said: “The purpose of this additional voluntary cut is to strengthen the risk mitigation efforts of the alliance between the Organization of the Petroleum Exporting Countries (OPEC) and the producing countries. External countries, including Russia (as OPEC+ Referred to), supporting oil market stability.”
Following Saudi Arabia’s announcement, Russia also announced voluntary supply cuts of 300,000 barrels per day until the end of December. reutersThe OPEC+ meeting is scheduled to be held in Vienna – Austria on 26 November.
Analysts at Australia and New Zealand Banking Group (ANZ) say the market’s focus has shifted from fears of supply disruptions to fears of a decline in oil demand.
Oil tanker passing through the Strait of Hormuz Photo: Reuters
This week, investors are particularly interested in economic data from China after the world’s second-largest oil consumer released a disappointing October Purchasing Managers’ Index (PMI). Tony Sycamore, analyst at IG Market Analysis Company (Australia), predicts that oil prices will continue to rise this week based on information and technical analysis data from the Middle East.
Another reason for oil price fluctuations is that the US House of Representatives on November 3 passed a bill to strengthen sanctions on Iranian oil, which also imposes measures on foreign ports and refineries in addition to handling petroleum exports from Iran. Will apply.
Additionally, the threat of wider conflict in the Middle East also causes concern for the Strait of Hormuz located between Oman and Iran – the world’s most important oil shipping route, where approximately 1/5 of global oil production passes each year. Is.
However, Mr. Andy Lipo, Chairman of Lipo Oil Associates Consulting Company (USA), assessed: “The likelihood of supply disruption, particularly the closure of the Strait of Hormuz, is very low”, as oil producers such as Saudi Arabia, Iran, Iraq and Kuwait still depend on revenue from crossing the strait.
Goldman Sachs Bank analysts agree with the above opinion, but the World Bank estimates that if the conflict continues to escalate, oil prices could rise to USD 157/barrel. Meanwhile, Morgan Stanley Bank estimates that India’s economic stability may also be weakened due to oil prices remaining at $ 110 per barrel. As the world’s third-largest oil consumer, India is one of the most vulnerable economies in Asia if crude oil prices rise.
according to the newspaper Guardian (UK), Mr. Larry Fink, CEO of BlackRock (USA), the world’s largest asset management company, said that the combination of the conflict in Gaza and the Russia-Ukraine conflict has pushed the world into an entirely new future.
Mr. Jamie Dimon, Chairman of JP Morgan, America’s largest bank, argued that what is happening on the geopolitical front today has the biggest impact on the future of the world, especially in terms of the global economy. Demand is very volatile.