FXEMPIRE
All
Ad
Corona Virus
Stay Safe, FollowGuidance
World
44,787,418Confirmed
1,179,410Deaths
32,740,775Recovered
Fetching Location Data…
Advertisement
Advertisement
Vladimir Zernov
U.S. Stock Market

Oil Video 18.09.20.

Advertisement

Saudi Arabia Puts Pressure On Laggards

WTI oil continues to move higher after the OPEC+ meeting which took place on Thursday. OPEC+ was set to discuss the performance of countries that failed to comply with the production cut deal. The main laggards are Iraq, Nigeria and United Arab Emirates.

Oil got an additional boost after Saudi Arabia put significant pressure on the laggards and gave them time until December to make up for their previous overproduction.

Interestingly, Saudi Arabia warned traders against speculating in the oil market and promised to make the market unpredictable to hurt speculators. Most likely, Saudi Arabia is not satisified with the recent sell-off which it attributes to speculating activity.

Saudi Arabia Energy Minister has reportedly stated that OPEC+ was ready to hold an extraordinary meeting in October if oil demand was weaker than expected. These words were interpreted as Saudi Arabia’s readiness to make additional oil production cuts in case oil prices fall far below the $40 level.

While Saudi Arabia managed to deliver strong verbal support to the oil market, it remains to be seen whether OPEC+ members are ready for additional oil production cuts at a time when their budgets are under significant pressure.

Russia Believes That Oil Demand Will Get Back To Normal In The Second Quarter Of 2021

Russia also decided to offer verbal support to the market, and its Energy Minister Alexander Novak stated that oil demand should fully recover in the second quarter of 2021.

This is an optimistic forecast given the current situation on the coronavirus front. Israel has just entered a second lockdown while European countries are introducing new virus containment measures.

The recent reports from OPEC and IEA also noted a slowdown in oil demand recovery.

In this light, Russia’s oil demand recovery forecast looks like a way to support the market rather than a true forecast.

Oil demand cannot get back to normal without a normalization of travel demand which is impossible before the world gets a COVID-19 vaccine and mass vaccinations begin.

While several vaccines may be ready by the end of this year, their mass production will take time. Mass vaccinations are also not an easy process. In this light, a full return to normal in the second quarter of 2021 looks like a very optimistic prediction.

For a look at all of today’s economic events, check out our economic calendar.

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Trade With A Regulated Broker

  • Your capital is at risk
IMPORTANT DISCLAIMERS
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
RISK DISCLAIMER
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
FOLLOW US