2019-11-11 • Updated
Oil prices dropped to $50.40 on last Thursday following the restart of two key Libyan oilfields which can produce nearly 400K barrels per day. Libya is exempted from the OPEC output cut agreement. So, increased crude output of this country would offset efforts by OPEC members and other larger crude producers to cap a global oil glut.
Brent oil futures extended their losses on Friday after Baker Hughes showed a rise in US oil rigs for a 15th week in a row. Rising US oil production is one of the biggest headwinds for oil prices in the medium term.
In 2016, US shale companies reached the break-even point at prices of $30-40 per barrel, so, no wonder we see how the production of shale oil is growing. The breakeven cost per barrel, on average, to produce Bakken shale at the wellhead has fallen to $29.44 in 2016 from $59.03 in 2014, according to Rystad Energy consultancy. The only thing that might stem a nagging growth of the US oil industry is the shortage of natural resources. There is a great problem of exploration of new deposits. Donald Trump had recently signed an order allowing expansion of drilling activities to remote places such as the Arctic. But this will unlikely encourage shale oil producers to launch a range of new offshore projects, as they are very costly. The shortage of US oil resource might be supportive of oil prices in the longer term. At the present moment, the data indicating a revival in the US oil industry will continue exhibiting a certain degree of pressure on the oil prices.
In May, investors will closely monitor the process of negotiation on the extension of the OPEC-led output cut agreement. OPEC Secretary General Mohammed Barkindo in his recent comments said that efforts to get a consensus on the deal extension before the Vienna conference in May are under way. He also suggested that the supply cuts were rather effective in keeping oil prices above $50 and curbing global crude inventories. Therefore, additional deeper cuts are needed to reignite oil price rally through the mid $50-barrel level.
In the next few days, traders will be waiting for the American Petroleum Institute (API) report on the number of US crude and refined product stocks and for the official figures from the Energy Information Administration coming on Wednesday. A substantial drop in the US stockpiles will be a tailwind for oil prices.
Crude oil futures surged on Monday due to disruptions in Russian refining capacity caused by Ukrainian drone strikes and Moscow's decision to cut output to comply with OPEC+ targets. The West Texas Intermediate (WTI) contract for May settled at $81.95 a barrel, up $1.32, while the Brent contract for May settled at $86.57 a barrel, also up $1.32. Russia instructed...
Brent oil is currently on a bullish trend, facing resistance near $84 and supported by the 200-day EMA. Breaking above this level could lead to a climb towards $90. Short-term support is observed around $80, backed by the 50-day EMA. As summer approaches and travel increases, crude oil tends to benefit from seasonal patterns. Despite temporary setbacks, buying...
Amid uncertainty driven by geopolitical events, oil prices surged to record highs. However, a correction in oil prices is observed with a gradual improvement in the situation in the Middle East and an increase in demand. The question facing investors is whether there are prerequisites for further price growth or if everything depends on the dynamics of the political landscape. In this article, we will explore the impact of recent events on the global oil market and the prospects for developing this crucial commodity sector.
Jerome H. Powell, the Federal Reserve chair, stated that the central bank can afford to be patient in deciding when to cut interest rates, citing easing inflation and stable economic growth. Powell emphasized the Fed's independence from political influences, particularly relevant as the election season nears. The Fed had raised interest rates to 5.3 ...
Hello again my friends, it’s time for another episode of “What to Trade,” this time, for the month of April. As usual, I present to you some of my most anticipated trade ideas for the month of April, according to my technical analysis style. I therefore encourage you to do your due diligence, as always, and manage your risks appropriately.
Bearish scenario: Sell below 1.0820 / 1.0841... Bullish scenario: Buy above 1.0827...
FBS maintains a record of your data to run this website. By pressing the “Accept” button, you agree to our Privacy policy.
Your request is accepted.
A manager will call you shortly.
Next callback request for this phone number
will be available in
If you have an urgent issue please contact us via
Live chat
Internal error. Please try again later
Don’t waste your time – keep track of how NFP affects the US dollar and profit!
|
