Affected by oil producers the doha meeting failed to reach a frozen production agreement, 18 international oil prices fell sharply after opening, but then the news that a Kuwaiti oil workers went on strike from low oil prices gradually rise, closing down co., LTD. Some market participants pointed out that although a frozen produce agreement was a producer, but low prices of oil market supply and demand balance already in progress.
Citigroup, said Ed Morse, director of the commodity research the strike led to the production of support for the market is the main reason why oil prices to make up lost ground on the day, this is far stronger than expected to achieve the effect of the doha meeting.
Senior trader, oil brokerage company President Raymond Paramount options card points out, most traders believe that the doha meeting last week not substantive outcomes. New York oil prices 17 opened sharply lower in early trading at around $37.6, from a technical point of view, this is an important support level of oil prices. Since oil prices higher, gradually, which make people think oil prices will not fall to a lower level, low open become a buy, buying oil prices recover.
He thinks, oil prices have walked trough, is unlikely to fall below $30 a barrel, he expects New York oil prices this year will be $35 to $55 a barrel.
Recent data show that oil prices are low for manufacturers of crude oil production, market supply and demand balance is underway. 13 the U.S. energy information administration, according to data released the previous week the average daily oil production continues to fall, reduce 31000 barrels to 8.977 million barrels, below 9 million barrel mark.
The U.S. energy information administration in April report predicts that this year and the average daily oil production 8.6 million tanks and 8 million barrels, respectively the two expected values a report last month cut its 100000 barrels.
Royal bank of Canada commodities, chief strategist at croft, points out that low oil prices has put a lot of pulling out of the market, the high cost of production of oil prices is expected in the fourth quarter of this year to about $50 a barrel. If crude oil manufacturers production speed, oil prices at $50 time may be in advance.