UNITED STATES (VOP TODAY NEWS) — Oil prices are moving to $ 69 a barrel after two sessions of decline in a row, but they are still preparing to demonstrate the maximum weekly decline this year, Reuters reports.
The quotes are being pressured by an increase in oil reserves and concerns about the impact of the US-Chinese trade war on global economic growth and fuel demand.
The cost of the July futures for Brent crude on the London Stock Exchange ICE Futures to 16:11 Moscow time rose by 1.74% to $ 68.94 a barrel. Since the beginning of the week, futures have lost almost 5% in price.
The price of WTI crude for July delivery on the New York Mercantile Exchange (NYMEX) rose 1.81% to $ 58.96 a barrel.
The Energy Information Administration (EIA) of the US Department of Energy reported on Wednesday that the country’s commercial oil reserves for the week of May 17 rose by 4.7 million to 476.8 million barrels. Reserves reached their highest level since July 2017 due to weak demand from the refinery.
Meanwhile, the voluntary restriction of production under the OPEC + deal and the reduction in deliveries as a result of US sanctions against Iran and Venezuela put upward pressure on oil prices.
OPEC + countries agreed to reduce oil production during the first half of 2019 by 1.2 million barrels per day. However, according to the joint monitoring committee, the actual supply of oil from the group has declined significantly more.
“There is reason to doubt that Saudi Arabia will be ready to increase production volumes, taking into account the latest price cut,” analysts at Commerzbank say. “Therefore, we expect that oil prices will rise again soon.”
UBS predicts that the price of Brent will again reach $ 75 per barrel this month due to reduced supplies.
“The level of compliance with OPEC and its allies agreement to reduce production remains high, while production in Iran and Venezuela is likely to decline again this month,” wrote UBS analyst Giovanni Staunovo in a report.
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