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Difficulties in the Middle East caused the growth of Brent to 72.14 US dollars

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Difficulties in the Middle East caused the growth of Brent to 72.14 US dollars
May 16
09:00 2019

Despite the forecasts for a decline in global demand and data on an increase in US oil reserves, the market still shows the growth. The deterioration of the situation in the Middle East is the main reason for such “bullish” sentiment.

July contracts for Brent crude oil on the London Stock Exchange have risen by 37 cents to the value of $ 72.14 per barrel. At the last session, futures also grew in price rising by 53 cents.

On NYMEX, WTI futures for June have risen to 62.35 US dollars. At the last trade they cost $ 62.02.

Saudi Arabia announced an attack on the East-West Oil Pipeline. According to the authorities, 7 units of armed drones participated in the attack. Because of the attacks, it was decided to temporarily suspend the activities of the pipeline.

Analysts say that the attacks on the oil infrastructure in the Middle East and supply difficulties give investors a reason to worry. At the same time, the possibility of reducing global demand pulls the market in the opposite direction. There is a large volatility because of this.

According to the data provided by the US Department of Energy, oil reserves have increased by 5.34 million barrels. According to the experts interviewed by the Wall Street Journal, the stocks should have been reduced by 1.4 million.

Gasoline reserves have fallen by 1.2 million barrels, distillates- by 100 thousand. Analysts cited other figures: a decrease of 600 and 500 thousand, respectively.

On Wednesday, the IEA published a report, in which the agency provided an updated estimate of the global demand for the current year. The figure has decreased to the value of 1.3 million b / d. This year the total demand for oil is expected to be 100.4 million b / d.

 

The material was prepared with the participation of Katya Gordon,
a leading analyst of the brokerage company CT Trade

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