08/12/2014
Markets facing an oversupply
American tension - Russian influence in oil prices and increases investors' concern
Oil experts said that the low crude prices over the past week will probably decline this week near the lowest levels in five years. They noted that the market affected by the continuing wrangle over Russian-American crisis in Ukraine, not geopolitical pressure notably abundant supply resulting from the surge in oil production American rock at the time, the OPEC decided last month not to cut production. According to the ' economic ' Dr. Ibrahim Ezzat investor and businessman said the challenges facing the oil market at the present stage of large powerful economies take hold, led by Saudi Arabia and the Gulf in the face of these challenges, while others will pay the exorbitant Bill of budgets and their ability to grow and meet financial obligations. He said the sharp decline in oil prices by 40 per cent since June last year negatively in the economy of a country like Iran is oil exports more than 50 percent of their income, so was thinking about reducing dependence on oil revenues in the new budget.
With Russian Igor yakovlev, an analyst said that the situation in the oil market is tightening, especially with the US Russian political relations, referring to the US Congress this week on the request of President Barack Obama tightened sanctions on Russia. He stressed the need not to mix political conflicts in the economy, especially the energy market, which is vital for the international economy cannot manipulate it, noting that the Russian economy will face a slowdown in early 2015 because of the sharp decline in oil prices, adding that the Russian budget depends on high prices for oil at around $ 100. Yakovlev said that Moscow is moving to expand the petroleum products to meet the crisis of falling prices by intensifying cooperation and dialogue with all producers in order to maintain market stability.
Russian analyst said the economic changes imposed on the Nations of the world to replace crude export expansion in the oil industry, they provide jobs, which reduces the burden on the economy with the need to expand reliance on renewable energy, noting that Germany, for example, the largest European economy, raise the banner of ' renewable energy until 2050 ', pointing out that political conflicts severely affected rates of development in the oil sector, saying that politics and Economics and energy particularly one thing cannot be separated. For its part, says Wayne Beach Vietnam analyst price drop impact negatively on the economies of all producers, but to varying degrees, all producers face crises of a strong and effective mechanisms to mitigate the effects of future crises because the image also carry a lot of concerns on the development of the international economy and on oil producers in particular. It was enough to monitor the State of oil like Kuwait where retreat this week the General index of the stock market to its lowest in more than a year and a half.
Vietnamese analyst said that the market in Kuwait move with the price of oil, so it will take time to balance the market and investors abandon the broad banner warned them not to diminish the expectations of investors to settle oil price after OPEC decision ' ' stabilizing production. The declining oil prices raised fears among investors of a continuation of this situation which increased caution and vigilance by market makers, emphasizing that the sharp decline is not in the interest of producers or consumers and better maintain a stable market and fair prices for oil, the need for broad international cooperation and coordination between all the forces in the market, in particular between producers inside and outside OPEC, ' '. According to beach it is necessary to reduce the gap between supply and demand current incident because of abundant oil supply and limited demand expected to rock oil producers would withdraw from the market in light of current low prices because of the high cost of production, and is, which might contribute to an improvement in the price.
