Mettis Global News
Mettis Global News
Mettis Global News
Mettis Global News

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Brent breaches $80 a barrel for first time since 2014

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Oil is well on its way to regain its place in limelight after more than three years of being irrelevant. Oil Prices – specifically the BRENT benchmark – for the first time since the year 2014 briefly crossed the $80 a barrel level. The oil prices took a breather on Friday, though after Brent closed just shy of the $80 level.

However, investors warn that the situation would take a different turn as the Venezuelans go to polls on Sunday.

Brent is currently facing resistance at $80 level but with the developing story of Iranian sanctions and tightening supply market; it seems highly likely that the oil will cross the $80 level comfortably during the coming week.  

Supply-side strategies from the OPEC have also started yielded definitive positive results for the oil markets, as compliance from members participating in cuts reaches 100 percent. OPEC and Russia are slated to discuss oil prices this week and decide on the future course of action regarding the cuts. OPEC officials have said the price rally is being driven by fear and not based on the fundamentals.

 

Price

Change

%Change

WTI

71.25

-0.24

-0.34%

Brent

78.36

-0.94

-1.19%

Natural Gas

2.878

-0.008

-0.28%

Furthermore, the retail oil prices in the United States have reached $3 a barrel (PKR 91.25/liter). Analysts around the globe predict, the increase in oil prices and demand for oil in the coming three months is going to have an inflationary impact around the globe. Investors warn that if these factors continue to be in place i.e. geostrategic tensions, global supply cuts and growing global economy, politics on oil would begin to take precedence over the course of next two to three years.

According to Energy Information Administration (EIA), US Crude Oil stocks have fallen by more than 18.3 percent during the last twelve months reaching 425.3 million barrels.

Posted on: 2018-05-19T14:55:00+05:00