Crude Oil Prices Are Horizontal

As a result of the balance between supply and demand activities, oil prices find buyers in a horizontal course. After the coronavirus epidemic emerged in Wuhan, China, large fluctuations in oil prices began. In some parts of the United States, where there are the highest number of cases and deaths, the implementation of measures to prevent the spread of the outbreak has followed a flat course after the US stocks in crude oil stocks have been more than anticipated and stabilized by OPEC producers' strong supply cuts. Futures contracts in New York have been announced by the Energy Information Administration (EIA) on Wednesday that crude oil stocks in the US have experienced the toughest decline this year last week, with 7.2 million barrels. After that, after gaining 1.4 percent, it traded around $ 40 a barrel. Market expectations also found support from the survey, which showed that OPEC production had fallen to its lowest level since 1991 last month. The number of cases continues to increase rapidly in the USA, where there are the highest number of cases and deaths due to the coronavirus epidemic, California, Texas and Florida, one of the most populous states in terms of population. While it was decided to stop the normalization steps in many regions, the measures started to be implemented again in some regions. This situation put pressure on the energy demand. However, important developments occurred in vaccination studies. It is stated that successful results were obtained in the first tests of BioNtech and SE.Pfizer Inc. On the other hand, oil remained in a narrow band at $ 40 this week, as the OPEC + coalition and other countries' supply cuts offset demand, which fell well below its pre-epidemic levels and at risk of further decline. India's oil minister, one of the countries with a rapid increase in the number of cases, pointed out that the consumption of petroleum products in his country is 88 percent of the 2019 level. According to Citigroup Inc.'s assessment, demand growth for refined petroleum products will not reach precise levels before the epidemic, with fewer people getting on the plane and driving. Victor Shum, vice president of IHS Markit energy consultancy, said in his statement on the subject, "Concerns about the re-rise of Kovid-19 cases in the US are driving a further rise in oil prices. In most countries, energy demand has been increasing since April, but demand for gasoline and jet fuel is still well below their levels a year ago". Western Texas oil (WTI) in the August futures remained calm at about $ 39.81 a barrel on the Nymex market at 10:40 am Singapore time. Brent oil in September, gaining 0.1 percent after rising 1.8 percent on Wednesday, reached $ 42.05 per barrel.