There is much talk about the return of balance in the oil markets, and to say that the oil war coming to an end , Optimistic voices have been depended on many factors including; the recession of the decline in prices, and high demand and according to statements from OPEC, the path of the global economy is going to recover.
May be talking about a relative improvement in prices is the best description to the state of the oil market , and as a matter of fact we have not yet reached to the stabilization of prices noting that the fluctuation is dominant characteristic of the market state , and the prices of oil are continuing to revolve around the barrier of $ 45 a barrel since the beginning of the week, there are factors led to the decline in production, such as forest fires in Canada that led to the contraction of daily production by 2.5 million barrels, and a decline in oversupply, as well as an increase of the commercial stocks in industrialized countries in addition to the dollar’s exchange rate.
Optimistic statements made by the Minister of Energy and Industry Mohamed Bin Saleh Al-Sada, who heads the current session of the Organization of Petroleum Exporting Countries “OPEC”, also is in the same direction, a return of balance to the oil market during the second half of this year and “the market is going in the right direction ,and It is expected to return to balance in the second half of this year, “adding that” the second quarter of this year witnessed a marked increase in the global demand for oil, as a result of the increase in demand for its products, “especially gasoline.
As likely to “continue to rise at rates greater from the next month with the start of the travel season and increased demand for motor fuel,” adding that “the global oil market is on its way to recovery,” according to “Reuters”.
Qatari minister has addressed the issue of world oil production, which he said that it continues to drop, “attributing this to several factors, most notably the” closure of many of production plants of higher cost “, in a reference in particular to the US shale oil .
Talking about improvement in prices in the coming days is a glimmer of hope for companies of shale oil as it is well known, especially if the price exceeded the fifty dollars a barrel, the barrier closer to the asking price for these companies to become active again.
It is expected that OPEC members will meet in the Austrian capital of Vienna on the second of June to discuss the future prospects of the oil markets and Saudi Arabia continues to assert that the collective action for all producers is the perfect solution for the oil market, which have fallen since mid-2014.
Finally, talking about the stability of the markets is early, especially since there are many fundamental and rapid changes that can appear at any moment, and may be the sacking of “dean of Saudi oil,” Ali al-Naimi, who spent nearly 60 years in the oil sec , is the most important of these events and the Saudi Arabia ‘ vision for 2030,” as well as the new government structuring is an important event as well, not to mention the volatile policy of Iran, and the future of “OPEC” in light of the new changes, and other factors that make it difficult to talk about the return of the balance to the markets in this period, as well as weeks separate us from “OPEC” meeting in Vienna, which makes talking about the markets more difficult.
Rawabet Research and Strategic Studies Center