empty
13.02.2023 10:42 AM
Oil prices fall on demand concerns

This image is no longer relevant

Oil prices went down early on Monday after ending sharply higher at the end of the previous week.

On Friday, oil prices surged by 2% on Russia's move to reduce oil output next month. Vice President Alexander Novak announced that Russia would "voluntarily" cut production by about 500,000 barrels per day next month, and not in retaliation for Western sanctions.

Although the market anticipated the move, oil prices still showed weakness after the news came. Moreover, experts believe that Russia's decision to reduce output would not be the last this year. The country is seen to cut oil production by 700,000 to 900,000 barrels per day throughout the year. In light of the gloomy outlook, the global oil market is now bracing for possible changes.

In the meantime, there is still continued optimism about higher fuel demand from China. Earlier, experts had suggested that after China removed the bulk of its Covid restrictions, its economic activity would expand, boosting demand for hydrocarbons. That would also mean an increase in imports of raw materials into the country. Nevertheless, that is just in theory, and market expectations are nothing more than just expectations. After all, no strong signals have come from China at least.

This image is no longer relevant

Early on Monday, Brent crude futures for April delivery traded lower on the London Stock Exchange. The price fell by 0.94%, or $0.81, to $85.58 per barrel. On Friday, the benchmark was up by 2.2%, or $1.89, closing at $86.39 per barrel.

Meanwhile, WTI crude futures for delivery in March were down on the New Your Stock Exchange earlier today. The quotes dropped by 1.15%, or $0.92, to $78.8 per barrel. On Friday, the WTI price gained 2.1%, or $1.66, closing at around $79.72 per barrel. Nevertheless, crude failed to consolidate, and a steep decline followed. Let's hope that the downtrend does not get any deeper.

This image is no longer relevant

Overall, crude prices were bullish last week. Brent added 8.1%, and WTI rose by 8.6%. However, an increase in the price does not akin to consolidation. The quotes simply failed to settle due to uncertainty and pessimism in the market that prevented crude from going higher.

Global economic risks are still weighing on oil prices, making them fluctuate. Analysts are worried about slowing global economic growth this year. Headwinds that occur, and there could be many, should be somehow leveled, according to experts. They hope that a recovery of China's economy will make the situation in the oil market better somehow. Although there have not been any clear signals of that coming. Therefore, the hydrocarbon market will likely be in turmoil.

In addition, concerns are now growing that the oil market might see a shortage of raw materials by the middle of the year. That would be yet another factor driving prices above $100 per barrel. The thing is that demand could reach 102 million barrels per day, which is higher than before the pandemic when it was some 2 million barrels per day lower. In the long run, demand could swell to 110 million barrels per day by 2025.

All in all, the cost of raw materials is likely to surge on the back of Russia's decision to reduce production. Therefore, Monday's fall in prices should not be seen as a trend reversal. Meanwhile, the oil market keeps trading under the influence of continued optimism.

Maria Shablon,
Analytical expert of InstaTrade
© 2007-2025

Recommended Stories

5月20日美國市場新聞摘要

儘管美國的信用評級被降低和國債收益率上升,散戶投資者仍然是股票市場中的活躍買家。淨購買額飆升至創紀錄的40億美元,這表明他們對股票市場長期韌性的信心。

Ekaterina Kiseleva 12:16 2025-05-20 UTC+2

市場小幅上漲:道指上升0.32%,納斯達克上漲0.02%,但在疫苗獲批後,Novavax 股價飆升

美國股市周一几乎持平收盘。然而,投資者的樂觀情緒在評級機構穆迪發表了強烈聲明後受到壓力:美國的最高信用評級已不再適用。

Thomas Frank 11:18 2025-05-20 UTC+2

比特幣:本週的預期。BTC突破107,000美元——紀錄能否保持?

領先的加密貨幣正努力保持其地位,即使並非總是一帆風順。目前,BTC處於領先地位,稍微簡化了保住高地的任務。

Larisa Kolesnikova 00:40 2025-05-20 UTC+2

美國消費力度減弱

在即將到來的一週,華爾街的注意力將聚焦於美國最大的零售連鎖店的財報上,這些是判斷變化的貿易條件如何影響經濟,以及近期股市暴漲是否有堅實基礎的重要指標。 貿易休戰緩解焦慮,但問題依然存在 將公佈季度業績的公司包括零售巨頭Target、Home Depot和Lowe's。

13:30 2025-05-19 UTC+2

5月19日美國市場新聞摘要

儘管有關貿易談判進展和高級別外交訪問的積極聲明,但S&P 500的預測仍然受限。分析師指出,該指數與其歐洲同行相比缺乏增長,這顯示美國市場競爭力的下降。

Ekaterina Kiseleva 12:20 2025-05-19 UTC+2

美國消費者消費放緩:Target、Lowe's 和 Walmart 有何指示

本周華爾街將關注美國最大零售商的財報,以評估不斷變化的貿易環境如何影響經濟,以及最近的股市反彈是否真正站穩腳跟。 零售巨頭Target、Home Depot和Lowe's等公司將公佈季度業績,這些業績是在由於總統唐納德·特朗普的關稅政策引發的經濟衰退擔憂有所緩解之際發佈的。

Thomas Frank 10:35 2025-05-19 UTC+2

5月16日美國市場新聞摘要

Micron Technology的股票延續其穩定的上漲趨勢,受到樂觀技術信號的支撐。投資者的目標價為117.34和137.12,令該股無論在短期還是中期都具有吸引力。

Ekaterina Kiseleva 13:20 2025-05-16 UTC+2

STOXX 600 攻佔高峰:增長方向與投資者前景

週四的股票交易以不同方向結束——投資者在科技樂觀情緒和醫療保健行業的警示信號之間做出選擇。 在四月因美國與全球合作夥伴之間的貿易對抗加劇而引發的劇烈波動中,S&P 500 指數自信地收回了失去的位置。

Thomas Frank 11:22 2025-05-16 UTC+2

美元:表面疲軟 - 核心強勁。遊戲尚未結束,美元準備出其不意的行動

在外匯市場,經濟基本面與地緣政治策略正在影響美國美元匯率的新階段已經開始。美國政府在非正式的場合考慮美元走弱的想法,但正式場合則無人承認任何事情。

Anna Zotova 00:39 2025-05-16 UTC+2

股市過山車:AMD 飆升,American Eagle 下跌,投資者感到困惑

雖然市場緊密關注貿易協議的動態,但美國前總統川普正在訪問海灣國家。這次出訪中關鍵的成果是沙特阿拉伯的承諾,將投資約6000億美元,此消息立即在投資圈引起興奮。

Thomas Frank 12:59 2025-05-15 UTC+2
现在无法通话?
提出您的问题,用 在线帮助.