Bloomberg expects higher oil prices as oil is out of stock during the epidemic

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Bloomberg expects higher oil prices as oil is out of stock during the epidemic

Data from the International Energy Agency showed that the oil reserves accumulated in storage facilities around the world during the epidemic were practically exhausted, which may increase oil prices in the second half of this year.

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Oil reserves in the world’s advanced economies were 57 million barrels higher than the average data for this indicator for the years 2015-2019.

And Bloomberg News pointed out that the surplus reserves of oil in July 2020 were almost five times higher, amounting to 249 million barrels, indicating that stocks decreased in recent months further, amid increased demand.

The agency said that the largest oil reserves are currently stored in China, while US hydrocarbon reserves have practically returned to the level observed before the epidemic, reaching 1.28 billion barrels in February.

And Bloomberg notes that oil stocks on the east coast of the United States, last week, reached their lowest level in 30 years.

During the past two weeks, tanker oil reserves decreased by 27% to 50.7 million barrels.

The cost of June Brent crude futures on the London Stock Exchange rose on Friday to $ 67.08 a barrel.

Bloomberg predicted that the price of oil, against the backdrop of the expected reduction in oil reserves in the second half of 2021, may rise to $ 74 a barrel.

The oil exporters had decided, contrary to expectations, in a meeting held on the first of April, to increase oil production as of next May.

OPEC + countries will increase their oil production in May by 350,000 barrels per day, in June by another 350,000 barrels per day, and in July by another 450,000 barrels per day. The decision was taken promptly for a period of three months.

It is noteworthy that OPEC + countries, which represent more than 40% of global oil production, have met every month since the beginning of 2021 to determine production levels in the short term. This approach gives members more flexibility in the face of a recovery in fragile demand.

Source: TASS



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