Less than three weeks after rocket and drone strikes on Saudi Arabia‘s main oil facility sparked a record price hike, crude has fallen below $ 60 again in London. The kingdom has now stabilized production back to pre-attack levels and investors are turning their focus back on signs of economic slowdown.
As crude prices plummet again – completely wiping out the scales caused by attacks in Saudi Arabia – OPEC + ministers acknowledged the growing risks of oil demand, but gave no indication of a change in strategy.
“Of course, demand is affected by the status of the global economy and the economy is slowing down,” Russian Energy Minister Alexander Novak said in Moscow. “There are no crisis events calling for an emergency meeting.”
Only in recent days have they brought a sudden surge in America’s crude stoc
“There are some concerns about the recessionary forces,” said Saudi Energy Minister Prince Abdulaziz Bin Salman, who was appearing along with Novak at the Russian Energy Week conferenks, signs of stagnation in the euro area economy and slowing growth in US payrolls.
Recessionary forcesce in Moscow. “There’s a gloomy look that’s drawn.”
However, the minister added that many assumptions about the economy were very pessimistic.
“There are things that are real, and things that are perceived. We are driven by negative expectations,” Prince Abdulaziz said. “On the demand side, yes it is lower but people need to understand that supply can also become lower” than current forecasts.
The Organization of Petroleum Exporting Countries and its allies, collectively known as OPEC +, are scheduled to meet again in the first week of December. Their current deal to cut output by 1.2 million barrels per day expires at the end of March, and the group could be pressured to extend or deepen those curves if the outlook for oil demand worsens.
The International Energy Agency, which advises developed economies on energy policy, currently sees global demand expanding by 1.1 million barrels per day this year and 1.3 million in 2020, well below the projected increase in supply. IEA consumption estimates could be revised even lower, Chief Executive Officer Fatih Birol said this week./Investing.com