Oil prices have fallen by 4% in the doubt in reducing the production of raw materials
On Monday during the US trading, oil prices fell as traders are skeptical about the possibility of an agreement between the major producers of oil in order to reduce the extraction of raw materials in the world.
Last week oil has risen dramatically in price by reports that senior officials of OPEC and oil industry in Russia is conducted informal talks on a possible agreement to reduce production and decrease oversaturation offers.
Prices came under further pressure after the release of weak Chinese manufacturing data, which have caused fresh fears about the health of the second largest economy in the world.
Purchasing Managers’ Index in China’s manufacturing fell to 49.4 from 49.7 in December, showing a drop below the 50 level that separates growth from contraction.
Meanwhile, China’s manufacturing PMI in from Caixin rose to 48.4 from 48.2 in December.
As of 13:50 GMT, or 8:50 Eastern time, at the London ICE Futures Exchange, Brent oil with delivery fell 99 cents, or 2.75% in April, and was trading at $ 35.00 per barrel .
For the week traded in London, Brent crude jumped $ 3.81, or 10.58%, lifting the second consecutive week. Brent has risen by almost $ 9.00, or 25%, after the collapse of the January 20 to 12-year low of $ 27.10. Despite recent advances, Brent crude closed in January lost 3.7% amid lingering concerns about the global reserves of oversaturation.
Oil demand in the world market is still ahead of the demand due to the boom of shale oil production in the United States and adopted after the OPEC decision to maintain the current quota for the production of raw materials, despite the saturation of the oil market. Subsequently, a surplus only get worse, because Iran is preparing to return to the world market after the lifting of Western sanctions.
On the New York Mercantile Exchange WTI crude oil for March delivery fell $ 1.25, or 3.73%, to $ 32.37 a barrel during morning trading in New York. Last week, crude oil futures traded in New York rose $ 1.43, or 4.25% more expensive than the second week in a row.
US crude soared by nearly $ 7.50, or 22%, after the collapse of the January 20 lower price of $ 27 for the first time since September 2003. In January US crude lost 8.9% as investors worried about the combination of the huge oversupply of the economic slowdown, especially in China.
Meanwhile, today the spread between Brent and WTI oil brands was $ 2.63 compared with $ 2.37 at the close of trading on Friday.
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