empty
13.02.2023 10:42 AM
Oil prices fall on demand concerns

This image is no longer relevant

Oil prices went down early on Monday after ending sharply higher at the end of the previous week.

On Friday, oil prices surged by 2% on Russia's move to reduce oil output next month. Vice President Alexander Novak announced that Russia would "voluntarily" cut production by about 500,000 barrels per day next month, and not in retaliation for Western sanctions.

Although the market anticipated the move, oil prices still showed weakness after the news came. Moreover, experts believe that Russia's decision to reduce output would not be the last this year. The country is seen to cut oil production by 700,000 to 900,000 barrels per day throughout the year. In light of the gloomy outlook, the global oil market is now bracing for possible changes.

In the meantime, there is still continued optimism about higher fuel demand from China. Earlier, experts had suggested that after China removed the bulk of its Covid restrictions, its economic activity would expand, boosting demand for hydrocarbons. That would also mean an increase in imports of raw materials into the country. Nevertheless, that is just in theory, and market expectations are nothing more than just expectations. After all, no strong signals have come from China at least.

This image is no longer relevant

Early on Monday, Brent crude futures for April delivery traded lower on the London Stock Exchange. The price fell by 0.94%, or $0.81, to $85.58 per barrel. On Friday, the benchmark was up by 2.2%, or $1.89, closing at $86.39 per barrel.

Meanwhile, WTI crude futures for delivery in March were down on the New Your Stock Exchange earlier today. The quotes dropped by 1.15%, or $0.92, to $78.8 per barrel. On Friday, the WTI price gained 2.1%, or $1.66, closing at around $79.72 per barrel. Nevertheless, crude failed to consolidate, and a steep decline followed. Let's hope that the downtrend does not get any deeper.

This image is no longer relevant

Overall, crude prices were bullish last week. Brent added 8.1%, and WTI rose by 8.6%. However, an increase in the price does not akin to consolidation. The quotes simply failed to settle due to uncertainty and pessimism in the market that prevented crude from going higher.

Global economic risks are still weighing on oil prices, making them fluctuate. Analysts are worried about slowing global economic growth this year. Headwinds that occur, and there could be many, should be somehow leveled, according to experts. They hope that a recovery of China's economy will make the situation in the oil market better somehow. Although there have not been any clear signals of that coming. Therefore, the hydrocarbon market will likely be in turmoil.

In addition, concerns are now growing that the oil market might see a shortage of raw materials by the middle of the year. That would be yet another factor driving prices above $100 per barrel. The thing is that demand could reach 102 million barrels per day, which is higher than before the pandemic when it was some 2 million barrels per day lower. In the long run, demand could swell to 110 million barrels per day by 2025.

All in all, the cost of raw materials is likely to surge on the back of Russia's decision to reduce production. Therefore, Monday's fall in prices should not be seen as a trend reversal. Meanwhile, the oil market keeps trading under the influence of continued optimism.

Maria Shablon,
Experto analítico de InstaForex
© 2007-2025
Seleccione el marco de tiempo
5
min
15
min
30
min
1
hora
4
horas
1
día
1
s.
Gana con los cambios en el valor de las criptomonedas con InstaForex.
Descarga MetaTrader 4 y abre tu primera operación.
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    UNIRSE AL CONCURSO

Recommended Stories

De $4 a $100 mil por moneda – ¿por qué están despertando las carteras BTC «antiguas»?

Siete carteras de Bitcoin «antiguas», creadas en abril y mayo de 2011, se activaron repentinamente. En conjunto, movieron 70 000 BTC – el equivalente a $7,6 mil millones al tipo

Svetlana Radchenko 07:25 2025-07-07 UTC+2

S&P, Nasdaq y Dow suben al unísono: los mercados reaccionan a las sorpresas en el empleo y la política comercial

S&P 500 subió un 0,83%; Nasdaq subió un 1,02%; Dow subió un 0,77%. El crecimiento del empleo en EE. UU. superó las expectativas en junio. Tripadvisor sube tras el informe

11:15 2025-07-04 UTC+2

NonFarm Payrolls, la Fed o el big beautiful bill: ¿qué quebrará al dólar estadounidense?

Wall Street incansablemente marca récord tras récord . El miércoles, el índice S&P 500, impulsado por los gigantes tecnológicos, volvió a alcanzar un máximo histórico. La razón no fue solo

Svetlana Radchenko 07:32 2025-07-03 UTC+2

Paz con China, caos en la Fed: ¿qué es más importante para el dólar?

EE. UU. y China anunciaron nuevos acuerdos comerciales, una noticia que hace no mucho podría haber sido un salvavidas para el dólar. Pero no esta vez. La mañana del viernes

Аlena Ivannitskaya 08:02 2025-06-27 UTC+2

El Bitcoin brilla y se mantiene por encima de los $107 000, y el Nasdaq 100 tampoco se queda atrás: el mercado se anima

Al final de la semana actual, los mercados muestran animación y un repunte: el índice Nasdaq 100 ha demostrado crecimiento, y el mercado de criptomonedas, en particular el Bitcoin, también

Larisa Kolesnikova 13:01 2025-06-26 UTC+2

Juegos peligrosos del dólar: entre un posible colapso y nuevas esperanzas

La moneda estadounidense vuelve a estar agitada, y esta volatilidad continúa intensificándose. En este contexto, algunos analistas predicen el colapso del USD, mientras que otros, por el contrario, confían

Larisa Kolesnikova 13:57 2025-06-24 UTC+2

Trump bombardea Irán: los mercados en pánico, el dólar se dispara

En la noche del domingo, EE. UU. lanzó un ataque aéreo masivo contra instalaciones nucleares iraníes, iniciando una nueva fase de escalada en Oriente Medio. Ya el lunes, los mercados

Аlena Ivannitskaya 07:54 2025-06-23 UTC+2

Trump pensará si vale la pena bombardear Irán: los mercados respiran, el dólar cae

La tensión geopolítica que mantuvo a los mercados en vilo toda la semana finalmente se debilitó, al menos por un tiempo. Donald Trump declaró que se tomará dos semanas para

Аlena Ivannitskaya 08:06 2025-06-20 UTC+2

Tres golpes al mercado: Trump abandona la cumbre del G7, EE.UU. logra acuerdo solo con Reino Unido, el Banco de Japón mantiene las tasas

El martes por la mañana la atención del mercado de divisas se centra en tres acontecimientos, cada uno de los cuales puede alterar el equilibrio de fuerzas. El presidente

Аlena Ivannitskaya 08:31 2025-06-17 UTC+2

Contrastes del día: Nikkei al alza, el euro a la baja, el mundo contiene la respiración ante las negociaciones entre EE.UU. y China

J.M. Smucker cae tras un pronóstico pesimista, El Banco Mundial reduce el pronóstico de crecimiento global para 2025 El Nikkei sube, los futuros de Wall Street y el euro caen

07:54 2025-06-11 UTC+2
¿No puede hablar ahora mismo?
Ingrese su pregunta en el chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.