Energy Markets Witnessing Faltering Growth
Published By : 27 Aug 2012 | Published By : QYRESEARCH
Crude oil prices remains down since the commencement of worldwide economic recession. The slower rate of recovery is resulting in the suppressed demand for petroleum products. Iran being the dominant supplier of petroleum products, and ongoing concerns over geopolitical pressures with Iran has encouraged some countries to release their strategic petroleum reserves.
American Petroleum Institute reported that the prices for crude oil are to its lowest levels since four years. The US petroleum delivers 18 million barrels per day, which is a lowest level for any month since 1995. Oil production in US was, however high and reached to 6.2 million bpd, highest for any July since 1998.
John Felmy, Chief Economist of API, explained that the decreased consumer demand was mainly responsible for slower economic recovery and prolonged distrust in Eurozone. Despite the rise in housing industry and retail sales in July, weak demand for petroleum products indicates economic uncertainty.
According to the report from Joint Organization Initiative, Saudi Arabia crude oil prices were up in June and reached their highest value since 30 years. Most governments are planning to release their strategic petroleum reserves to meet their energy demands and fight the energy crisis. In 2011, Libyan production was shuttered by civil war and hence, governments of most nations were encouraged to release their strategic petroleum reserves.
According to API, the major reason for decline in oil prices was the decreasing usage of gasoline in the U.S. July oil spill in Wisconsin and oil refinery closures in the U.S., and California resulted in an increase in the oil prices, to more than USD 4 per gallon. One of the analyst reported that energy market is responding well to everything except oil.