Lower oil prices and precipitation forecast in Canada may stop canola prices from rising

Oil prices fell sharply yesterday, losing about 4-5% against the background of OPEC+ members ' agreement with the United Arab Emirates to increase oil production from 3.17 million tons. barrels per day up to 3.65 million barrels per day. barrels, as well as the UAE's decision to support the extension of the OPEC+ agreement until the end of 2022. It was disagreements with the UAE that caused a jump in oil prices last week.

September Brent crude futures on the London ICE exchange fell 4.6% to 7 73.4 a barrel in two days, while August WTI crude futures fell 5% to.71.6 a barrel.

An additional factor of pressure on oil prices was the increase in the rate of coronavirus infection in the United States and Europe against the background of easing quarantine restrictions.

Data on oil reserves in the United States did not coincide with analysts ' expectations and for the week decreased by 7.9 million barrels - to 437.58 million barrels, while gasoline and distillate reserves increased by 1.04 million barrels (to 236.54 million) and 3.66 million barrels (to 142.35 million), although analysts expected a decrease in reserves.

Lower oil prices today will put pressure on palm oil prices, which have jumped 6.5% since the beginning of the week and are trading at 4,111 ringgits per ton (9 981/ton), which in turn will put pressure on rapeseed oil prices.

Hot weather in Canada caused an 8% increase in canola prices this week, but forecasts of precipitation and lower temperatures in the canola growing area, against the background of lower oil prices, may turn prices around in the near future, especially against the background of increased rapeseed supplies in the EU and Ukraine.