The failure of the talks in Doha of the Organization of the petroleum exporting countries (OPEC), as well as Russia, Mexico, Kazakhstan and other major oil producing countries, which tried to agree to freeze production levels of “black gold,” added the statement by the head of the state oil Corporation of Saudi Arabia Saudi Aramco Amin Nasser that his country intends to “dramatically increase” oil production and strengthen its presence in the global energy market. It would seem, brought a thick line hopes oil-producing countries to increase oil prices.
Saudi Arabia has the largest oil reserves in the world (about three times larger than Russia). While the leaders of Iran (the second largest in the world by oil reserves) have also repeatedly emphasized that no plans to freeze or to cut production and delivery. All this, in theory, should was to once again derail global energy prices. However, we see that this has not happened yet. Prices, though not at a very high level (around 45 dollars per barrel) continue to stagnate.
In this regard, the observer of “Rosbalt” asked experts to Express their opinions about what other factors besides production volumes, affect now the level of oil prices.
According to the chief economist of Sberbank CIB Evgeny Gavrilenkov, there are a number of such factors. First, he said, despite the fact that the leaders of Saudi Arabia and Iran has repeatedly stated that it will increase oil production, specific figures are not called.
“Another point is that the number of small and medium-sized U.S. companies that are developing shale gas deposits, on the verge of bankruptcy, their debts are growing, the volumes of drilling are reduced,” said Gavrilenkov also.
The expert also said that the relatively fixed now the price of oil could affect the information published in some media, according to which, “the volume of reconnaissance drilling in the world today, the lowest in the last 60 years.”
The analyst also said that the price of energy is determined not only by supply but by demand, but here we do not see the factor that could significantly influence the situation. The idea is that the expectation of a serious reduction in the rate of growth of China’s economy haven’t come true. “Better than in the first quarter of 2016 were the economic indicators in Europe”, – said the expert.
World oil prices relatively stable and supports the decision of the European Central Bank (ECB) to buy not only government securities but also securities of corporate clients, including foreign companies, in particular, and the us, says Gavrilenkov.
The set of these different factors determines the current relatively stable price of oil, the expert concluded.
In turn, senior analyst, VYGON Consulting Maria Belova noted that the fundamental factors in the formation of oil prices has not changed. “In the foreseeable future expect that the next decline,” she said to the observer “of Rosbalt”, noting that the current relative stability in the market caused primarily by the actions of speculators.
According to her, at the commodity exchange open a lot of long positions and it is believed that the current rally is able to bring the price of oil to $ 50 per barrel. However, according to experts, this is a temporary phenomenon. “Until we see an oversupply of oil on the market and this factor will not disappear, at least until the middle of next year,” – said Belov, according to which, it should lead to another drop in oil prices.
