Oil: а review of the market situation

Oil prices fell sharply today, losing more than 2%, which is associated with the publication of a report on oil reserves in the United States, as well as news that Saudi Arabia increased oil production last month.

Data provided by US Department of Energy showed that during the week from 28 March to 3 April oil reserves increased by 10.9 million barrels to 482.4 million barrels, while experts waited for an increase of 3.4 million barrels. The report also reported that weekly growth of commercial oil reserves was the most significant since March 2001. Meanwhile, the oil terminal in Cushing rose by 1.2 million barrels to 60.2 million barrels, the highest since April 2004. Gasoline inventories rose by 817,000 barrels to 229.9 million barrels. Analysts had expected a decline of 1.3 million barrels. Distillate stocks fell by 250,000 barrels to 126.9 million barrels, while analysts had expected an increase of 900,000 barrels. Utilization rate of refining capacity increased by 0.7% to 90.1%. Analysts expected growth rate of 0.5%.

Meanwhile, today's oil minister of Saudi Arabia, Ali al-Naimi said that in March the kingdom from Central 10.3 million barrels per day, exceeding the previous record figure of 10.2 million award in August 2013. In the near future average daily production will remain close to 10 million barrels, said al-Naimi. Recall, Saudi Arabia, the world's largest oil exporter, accounting for more than 10% of world production. Meanwhile, Al-Naimi said again that Saudi Arabia is ready to raise rates, but only with the participation of non-OPEC.

"Although production may decline slightly in April and May, it is clear that Saudi Arabia responds to increased demand for its oil, despite the excess of oil on the market" - said the analyst Amrita Sen Energy Aspects.

Focus was also the monthly report from the International Energy Agency. Agency experts predict that the price of oil could fall to $ 15 a barrel next year, if the sanctions against Iran will be fully terminated in the event of reaching a final agreement on the country's nuclear program. "The increase in Iran's oil supply to the world market will reduce the IEA forecast oil prices in the $ 5-15. If a comprehensive agreement that will lead to the lifting of sanctions on Iran, is reached, the forecasts for the volume of oil supply, demand, and prices can significantly change, "- said the IEA. The agency estimates, Iran could increase production by at least 700 thousand. Barrels per day in 2016 (in March, the average volume of oil production in Iran 2.85 million barrels per day). According to the IEA, increase production Iran will lead to an increase in world oil reserves of about 500 thousand. Barrels per day in 2016. According to IEA forecasts (excluding the possible increase in production in Iran), the average price of WTI crude oil in 2016 will be $ 70 and Brent - $ 75.

May futures for US light crude oil WTI (Light Sweet Crude Oil) dropped to 51.66 dollars per barrel on the New York Mercantile Exchange.

May futures price for North Sea Brent crude oil mix fell 1.42 dollars to 56.95 dollars a barrel on the London Stock Exchange ICE Futures Europe.