As oil prices rise, Saudi Arabia raises the possibility of production increase, suppressing further rise
[지앤이타임즈]The international oil price rally continues.
It is interpreted as the result of the US cold wave leading to the shutdown of oil production facilities.
However, Saudi Arabia’s mention of the possibility of an increase in production, taking advantage of a rebound in oil prices, appears to be suppressing additional oil price growth engines.
According to the Korea Petroleum Corporation, the price of Dubai oil ended at $62.80 on the 17th, an increase of $0.50 per barrel compared to the previous day.
The Brent futures price also rose 0.99 dollars per barrel to $64.34, compared to the previous day, and WTI was trading at 61.14 dollars, up 1.09 dollars.
The WTI price is the highest in one year and one month after the $62.70 recorded on January 7th of last year.
The fuel price hike is influenced by the US cold wave and the expected decline in oil stocks.
In fact, a massive power outage occurred due to a record cold wave in Texas, the southern United States, and production of up to 120,000 barrels of crude oil per day was stopped due to freezing of oil wells and pipelines.
It is known that the operation of the facility of 2.6 million barrels per day, which is about 20% of the US refining capacity, has also been stopped.
A bigger problem is that claims are being made that restoration of these facilities can take up to several weeks.
However, unlike the damage to production facilities during a hurricane, there are also evaluations that the power outage and freezing of production facilities caused by a cold wave can be restored in a short time.
As a result of the American Petroleum Association’s (API) survey, the crude oil inventory as of the 12th was 468 million barrels, a 5.8 million barrels decrease from the previous week, which is also a factor driving up oil prices.
However, reports that Saudi Arabia, which announced voluntary production cuts of 1 million barrels per day in February and March, will announce an increase in production, are suppressing further oil prices.
The Wall Street Journal cited an OPEC+ official and reported that Saudi Arabia would announce an increase in production in April immediately after the OPEC+ meeting scheduled for March 4.
In this case, it is an analysis that it could be an important watershed in the direction of oil prices in the future in that oil demand is expected to increase due to the expansion of the corona 19 vaccination and the large-scale economic stimulus measures in the United States.
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