OPEC Makers Prefer Optimism Above Recovery as Oil Rises
Published By : 17 Feb 2015 | Published By : QYRESEARCH
London oil prices traded in at the highest price in two months while ministries in the OPEC maintained that the market will sustain a rebound.
Futures grew by almost 1 per cent. This is the third gain for it in four days. The manufacturers are showing a strong sense of optimism over the increasing prices and the trend has changed in the past few weeks, according to Mohammed bin Saleh Al Sada, the Energy Minister for Qatar.
Ali Al-Omair said the global oversupply of oil is currently lesser than the 1.8 million barrels per day that was previously estimated. It is the third largest producer in the Organization of Petroleum Exporting Countries, situated in Kuwait.
Oil has been in recovery mode; prices are the lowest they have been in six years. This happened due to drilling activities in the U.S., which has begun producing crude oil at record rates in the middle of a shale boom. The country also reduced the number of active rigs to the least they have been since August 2011. The focus of the market is currently shifting towards a tighter supply, as stated by Standard Chartered Plc.
David Lennox, an analyst at the Sydney-based Fat Prophets, said that they have seen the number of rigs and this will definitely have an impact in the near future. Many companies show forecasts for lesser rates of production before 2016 begins. This holds true especially for the U.S., which could essentially put a stop on the downtrend.
April settlement’s Brent rose by nearly 61 cents to US$62.01 per barrel as recorded in London on the ICE Futures Europe exchange. The same was recorded at US$61.94 near noon, Singapore time. The contract slipped by 12 cents to US$61.40 on Monday. All of Futures volumes trading were at almost 39 per cent less than the 100-day average.