Rising oil prices can not be called sustainable

Rising oil prices can not be called sustainable? Credit Suisse

Oil is preparing to complete the February growth for the first time since October. The market of “black gold” seems to have found a basis for medium-term bullish rally, analysts said.

This, above all, contributed to the information about the plans of a new meeting of the representatives of producing countries. Recall that at the end of last week, Venezuela’s oil minister announced a new mid-March negotiations on oil with the participation of Russia, Saudi Arabia and Qatar. After the appearance of this news, Brent crude reached a local high of $ 36.11. On Friday, she was able to test and $ 37.

“Frankly, the likelihood of further attempts to stabilize the price of energy and the production of concerted action for breaking the negative trend of the cost of energy was very low, – says Artem Deev, head of the analytical department AMarkets online broker. – Especially after a joint decision to freeze production at the January highs. “

“Despite the fact that market participants have not yet received a serious signal to turn on the oil trade strategy” buy on expectations, sell the fact “, may well be decisive for further trading. Resonant power of the news background is likely to continue to drag an asset to the new local maximum, “- says Artem Deev.

Some analysts are talking about that world oil prices have reached bottom. Their opinion, they confirm the statistics of Baker Hughes, according to which the number of oil drilling in the United States reduced the tenth week in a row, a trend that could lead to a drop in US oil production. However, the surplus of oil on world markets, the slowdown in global economic growth and the expected increasing supplies of oil Iran exerts a powerful pressure on the market.

Analysts at Credit Suisse (VX: CSGN) warn that the decline in oil prices, there are still risks.

“At the moment we do not have sufficient reason to believe that oil prices have stabilized and sustainable growth possible. In addition to promises not to increase oil production of significant changes in the structure of supply and demand was not observed. However, the rise in oil prices may be associated with expectations of a more accommodative monetary policy in developed countries. In our view, this factor can be decisive in the maintenance of oil prices at near-current levels or above “, – says Aleksey Pogorelov, chief economist at Credit Suisse in Russia.

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