Oil is becoming more expensive due to Saudi Arabia’s desire to reduce its production
Today, the financial markets have experienced the growth of oil futures for both Brent crude oil and WTI crude oil. The trend will go on.
The growth has been caused by yesterday’s statement by the Ministry of Energy of Saudi Arabia. It stated that the Kingdom was interested in stabilizing the oil market and intended to continue to work closely with other oil-producing countries on reducing production.
Let us recall that earlier the OPEC members reached an agreement on quotas for oil production. Contrary to the forecasts, Saudi Arabia keeps its promise. Despite the February increase in average daily oil production by 263 thousand barrels, the volume of the extracted black gold did not exceed the quota agreed by OPEC.
The total oil production by all OPEC countries in February amounted to 31.958 million barrels per day. This is 140 thousand barrels per day less than the previous figure. Saudi Arabia reported that the surplus of the extracted oil was sent to the oil storage in the Kingdom and wouldn’t be delivered to the world market. Today, the experts in the oil and gas sector are waiting for the publication of an official report on oil reserves in the United States. This information will certainly affect the oil quotes. According to the preliminary data, oil reserves in the USA have increased by 3.5 million barrels.
The material was prepared with the participation of Victor Kotov,
a leading analyst of the brokerage company VOSPARI.