Friday , November 27 2020

US crude oil enters market with rising global oil production



The tempo of some enthusiasm was the data that the US output had reached a new record level of 11.6 million bpd, and was expected to grow much faster than expected next year.

The US has now made Russia the world's largest oil producer, and the Energy Information Administration expects oil to reach 12 million bp by the middle of 2019, thanks to the oil oil.

Production rose not only in the United States, but also in many countries, including Russia, Saudi Arabia, Iraq and Brazil, and threatens to overcome demand next year.

Even if the US sanctions imposed on Iranian oil, the perception among investors is that there is sufficient supply to meet the demand, as reflected in the January futures contract with the Brent futures contract in February.

This price structure, known as Contango, takes place when traders and investors are more demanding than demand and therefore rather encourage more oil storage rather than sell, and thus create a larger, unsold crude oil pool.

"OPEC and Russia could use disruptions to support $ 70 per barrel," said Ole Hansen, head of commodity strategy at Saxo Bank.

WATCH:Here's the price of oil.


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