Oil prices increased by 25%, on expectations of revival in demand

2020-05-06 12:01:15
Machine translation
Oil prices increased by 25%, on expectations of revival in demand

World oil prices rose sharply after the entry into force of the agreement OPEC+, and with the support of the intentions of the gradual weakening of the quarantine.


From may 1, entered into force the agreement OPEC+ according to the record decline in oil production. In addition, a number of European countries reported a slowing of the pandemic coronavirus and the weakening of quarantine measures. The recovery of the Chinese economy and the repeal of some quarantine restrictions in certain States of the USA, Europe and Asia contribute to the rise in oil prices.


Yesterday, the quotes of Brent crude oil increased by 25%, for the first time since April 14, reaching the level 31,98 $/barrel, but at the end of the session once again fell to 30.8 $/barrel. The price of oil brand WTI increased by 30% to 25.85 $/barrel, but before the end of trading fell to 24.5 $/barrel.


Prices supported the intention of the major mining companies of the United States to cut daily oil production of 660 thousand barrels. Data on the US economy on Tuesday was better than expected, but still not contributed to increased demand for energy and oil. The ISM index of business activity in the non-manufacturing sector fell in April on negative 10.7 to 11-year low of 41.8.


the Market is expecting today's report on the trade of oil and oil products and their supply, which will define the further price dynamics.


Goldman Sachs Analysts Equity Research increased compared to the previous report, the forecast prices for Brent crude oil for 2021 from 52.5 to 55.63 $/barrel, WTI – з48,5 to 51,38 $/barrel.


Recovery of oil prices, support prices for agricultural products such as corn, canola, soy and vegetable oil, which fell due to falling demand for biofuels. But experts warn that the world economy will recover very slowly because of the restrictions on moving long distance will be, so the demand for automotive fuel will return to the previous level not earlier than next year.

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