Oil costs fell by the fourth day on Monday, losing 4%, as investors are concerned about the rise of COVID-19 infections in the United States and the series of new national blockades in Europe this weekend.
Foreign Brent benchmark futures fell 3. 9% to $36. 45 a barrel, and the US benchmark West Texas Intermediate index fell 6% to $34. 21. The value of oil has fallen nearly a quarter since the end of August.
The fall in crude oil futures costs is probably due to U. S. electoral uncertainty, amplified by emerging production in Lithrougha, European closures, and a transient disruption of raw oil orders to teapots in China, said Bjarne Schieldrop, SEB’s leading commodity analyst.
Oil values are lower than in late September, but they are still far from the degrees of suffering that were noticed in April and May, when the value of U. S. crude oil fell to -40 dollars in line with the barrel. The value of crude oil to be delivered in two years has also fallen, but not so drastically. Crude oil futures for December 2022 fell by about 16%, which is consistent with the year.
Concerns about the weakening of the call have eliminated all attempts through OPEC and its allies since May, when up to 10 million barrels of oil production have been withdrawn from the market.
A victory in Biden may be only medium-term oil charges due to stricter environmental regulations, and therefore a higher marginal production charge for the U. S. shale, according to Schieldrop, Biden’s joint comprehensive action plan for Iran will lead to the resumption of Iran’s production and exports. in 2022, he said.
SEB Research believes that if a Biden victory is bearish for long-term oil, the current value of $42 consistent with the barrel for delivery in 2022 is too low.
In addition, Baker Hughes’ knowledge showed that the number of oil rigs in the US was the only one in the world to do so. But it’s not the first time Under construction increased to 32 in October, implying that domestic oil and fuel production will increase in the coming months.
OPEC is scheduled to hold a policy assembly on 30 November and 1 December. Most likely, the organization will run from production expansion to the eventual deployment of COVID-19 vaccines in the first quarter of next year, but no commitments have been made. . however, Schieldrop said.
Neither Russia nor Saudi Arabia has the fiscal incentive to cut production unless oil reaches $20 a barrel, according to Stephen Innes, Axi’s leading market strata.
“An abundant detail of uncertainty around the OPEC assembly at the end of the month has the oil complex policy that would possibly be too unwelcome for OPEC to adjust at this stage,” Innes said.