19/03/2015
Brent falls below $ 53 because of rising inventories and weak demand
Recent declines disrupt oil producers
Yesterday the successive declines wave continued in crude oil prices in global markets after the news of the growing supply and weak demand in the United States, China and the continuation of the record-high inventories.
He saidtothe "economic," Ralph Valtman competent oil from the US Lexapro Foundation, "The return of sharp declines confused producers accounts but will not be at the level of the previous declines," The US dollar began in relatively undo a influential factor as there are positive signs for improved levelsdemand in some countries of the world consumed.
Valtman said that "many countries seeking to increase production, including Iran, after the lifting of the economic, Libya, Nigeria sanctions," referring to the mission statements launched Desagna Allison Secretary of Nigerian oil, which holds the presidency of the Organization of Petroleum Exporting Countries "OPEC" where he emphasized that the continued decline in oil prices will hamper the efforts of the countryto increase production to four million barrels per day.
Valtman pointed out that the Nigerian economy and many of the economies of producing countries, with the exception of the Gulf countries face greater difficulties, which made the minister of Nigeria confirms that the flexibility in capital expenditure and financing in general will decrease more in the year 2015 and that the continued decline in oil prices will reduce the room for maneuver of the sector and impede the investigationfour million barrels per day target.
Valtman noted the importance of economic performance in developing and producing countries to reduce dependence on crude oil exports and reserves well to fluctuations in oil prices, which will be a key feature in the market for a period, is brief.
Valtman said that global oil demand especially coming from China, one of the largest consumer markets characterized by volatility, adding that the recent economic reports indicated that there expected decline in crude oil volumes addressed by refining companies owned by the Chinese government in the second quarter of the year as domestic demand influencedtax increases and a slowdown in the economy, which could reduce demand for imports in the country's second-largest oil consumer in the world.
According to the report referred to the China raised taxes on petroleum products in late 2014 and early this year due to a decline in world oil prices, which won the demand for diesel fuel used widely in construction and heavy industry and other fuels used in transportation and industry types.
For his part, explained for "economic", Sebastian Jrlakh President of the European Business Council, that the surpluses and reserves believes Gulf economies but should not be relied upon alone, especially if it was expected that the declines will continue for some time and must work to diversify sources of income, referring to the request of KuwaitHelp the International Monetary Fund in order to impose taxes on companies in order to diversify sources of income year in the face of lower crude oil prices.
Jrlakh "The tax is an important source of income, despite some negative effects in the social level and in the investment, pointing to Abdul Mohsen Madj announcement, Minister of Trade and Industry that the International Monetary Fund intends to prepare a preliminary report on how the tax on companies operating in Kuwait application, noting that Kuwait does notcurrently impose any taxes on local companies and citizens and expatriates, but it imposes on foreign companies pay a tax of 15 per cent of the profits.
Jrlakh said the need to increase cooperation and coordination between producers both inside and outside "OPEC" and reach to adjust production in the market mechanisms, because the international supply filter the large increase in the coming period, especially if Iran were allowed to export and if stability in Libya and Nigeria, while remain the effect of oil rigs stoppedAmerica is limited in the international supply.
As she says for "economic", yen Beach analyst Vietnamese, "The rising inventories and access to record levels was an important factor in the return to declines due to fever previous purchase order to hoarding and speculation on prices."
The rise in crude inventories in the United States last week to exceed 452 million barrels, with the largest level of local stocks in 80 years at least.
Beach added that "other factors contributed to the decline, including the reports on the new abundance in the global supply due to increased production of Libya and Iran's attempt to export more oil to conclude after lift Western sanctions imposed by the nuclear agreement."
She explained analyst Vietnamese, that a stronger US dollar weakness remains influential or prominent in the price level in the market because the dollar rise in the previous period, making commodities denominated in the US currency more expensive for holders of other currencies.
Beach considered that the rise of the dollar stopped two days ago in the direction towards parity with the euro will lead to a relative improvement in oil prices in the case of continued.
Furthermore, Brent crude fell below $ 53 a barrel yesterday due to fears of inflation, supply, since the data indicated that US crude inventories have risen to a record level.
According to "Reuters", the American Petroleum Institute data showed yesterday that US stocks rose 10.5 million barrels to 450 million barrels in the week ending 13 March.
It is due to the Energy Information Administration of the US government issued official inventory data at a later time, and Analysts polled rising inventories 3.8 million barrels.
And Brent delivered May 70 cents to $ 52.82 a barrel after the previous session seal high seven cents at $ 53.51, while US crude fell delivery April of $ 1.52 to $ 42.21 a barrel after hitting its lowest level in six years, 42.05 inEarlier in the session.
