Finally we are seeing OPEC cuts taking a tole on world oil stock piles and a increase in demand starting to re surge. With US oil stockpiles falling by 700,000 barrels in the last week of February and and world demand up 2.2% from this time last year. You will have to forgive me for thinking that this is the first real indication of a bottom that I have seen in both world oil and the stock market as a whole.
With this new news at hand it will make for an interesting OPEC meeting this month as they will be very aware of the fact that if they drop production again and oil shoots back to old highs to quickly that this will put a lot of strain on already stretched economies and a renewed push for greener energy's. So i am going to put my money on OPEC going with a wait and see approach for this month.
For more on this please see Oil price up over petrol demand
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Non opec needs oil to be at $70+ , other wise its not economic or in the countries interest to get the oil out of the ground. So the oil price has still a little more to rise before production comes back with a vengeance in non opec. With opec cutting and production from non opec declining, and even with demand for oil not being strong, the oil price should rise in the coming months.
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