Crude Surges to Three-Year High

Adjust Comment Print

Worldwide oil prices hit their highest levels since late 2014 on Tuesday, pushed up by expectations of renewed U.S. sanctions against Iran and as Opec continues withholding supplies amid strong demand.

The prospect of fresh sanctions on Tehran and disruption to the country's oil flows has helped push the oil price to its highest since late 2014 this month.

Oil broker PVM's Tamas Verga states that the probability of the USA staying in the nuclear deal with Iran is low.

Brent last hit those levels in September 2014. And with demand for oil only growing, it is going to cause oil prices to skyrocket.

Crude oil prices climbed as high as $75.20 a barrel, the highest since November 27, 2014.

Oil prices have rallied over 20% since early February and nearly 70% since last year's low seen in June as joint production cuts between OPEC and Russian Federation have halted the supply side while continued global growth has increased demand as well. The prices of oil collapsed post that time due to an oversupply of crude oil in the market.

Apple hires former Samsung VP in attempt to jumpstart business in Korea
Instead of relying on Samsung as a sole supplier, Apple has plans to rope LG into a bidding war with the South Korean company. Considering the production timeline, results of the supposed negotiations should be revealed in the coming weeks.

Colorado State Senator Bob Gardner: Teacher strike bill will be amended
Democrats have been rallying around teachers in Colorado as they push at the legislature for increased school funding and pay. A bill was recently introduced in the Colorado Senate that aims to prohibit public school teachers' ability to go on strike .

How Kenyan politicians celebrated London Marathon winners
So I was telling the people 'can you please just tell us which one is our drink because it's exactly the same bottle". It's different pain, different training but I've really enjoyed it. "I am knackered.

Now, thanks to the massive output drop in Venezuela and the OPEC led production cuts, prices are being driven up. With record amounts of Oil all over the place, including the fully loaded ships at sea, Oil prices are artificially Very High! The worry is that if the USA left the agreement, Iran would again be subject to sanctions and global oil supplies would be restricted. "No good and will not be accepted!". At the same time, the world's biggest exporter, Saudi Arabia, wants oil at $80 per barrel as a way of boosting the budget and implementing the projected reforms. The only thing that is stopping the oil prices shooting through the roof is the fact that America's oil production has been rising.

The American Petroleum Institute (API) reported a surprise build of 1.099 million barrels of United States crude oil inventories for the week ending April 20, contrary to analyst expectations that this week would see a draw in crude oil inventories of 2.648 million barrels. He said the danger now facing the market is that Opec overshoots on tightening the market, which could exacerbate the backwardation in prices, prolong the rally in near-term prices and ultimately erode demand.

The upshot is that we doubt Trump will take any action to reduce oil prices. The blend is now more than double the price reached in early 2016 when global economic concerns were at their worst.

As a result, the US economy would, on balance, benefit from lower oil prices.

"Not many companies on Bursa Malaysia have a direct exposure to the changes in oil price".

Comments