Oil: an overview of the market situation

Oil prices fell, dropping at the same time below $ 105 per barrel, not much above the eight-month low, after analysts cut forecasts for global growth and demand for oil, and crude oil in the U.S. has reached its highest level in more than two decades. Unsatisfactory economic growth in the United States and in a number of developing countries, as well as a deep recession in parts of Europe have undermined demand for fuel at a time when oil production is growing rapidly, especially in North America.

Meanwhile, today it was announced that the International Energy Agency lowered its estimate for oil consumption in the 1st quarter of 2013 to 115,000 barrels a day to 89.9 million barrels a day. However, the forecast for growth in global oil consumption in 2013 was left almost unchanged at 0.8 million barrels per day. In addition, the report showed that the growth in oil demand in OECD countries will slow to 480,000 barrels a day in 2013, the IEA also lowered its forecast for oil supply from non-OPEC in 2013 to 20,000 barrels per day to 54.4 million barrels per day. Economists agency also added that the low level of activity in the industry will lead to the fact that in 2013 the demand for gasoline will exceed the demand for gas oil. At the same time, they noted that the current decline in oil prices may be short-lived.

Note that lowering forecasts raised concerns about the strength of the economic recovery. These concerns were highlighted by U.S. data, which were presented last week, and showed that employers hired in March, far fewer staff than expected.

Meanwhile, many traders fear that the outbreak of hostilities between the U.S. and Iran could disrupt oil supplies from the Persian Gulf.

May futures on U.S. light crude oil WTI (Light Sweet Crude Oil) dropped to 94.13 dollars per barrel.

May futures price for North Sea Brent crude oil mixture fell to $ 104.51 a barrel on the London exchange ICE Futures Europe.