(BFM Bourse) – Black gold contracts are taking a slight breather but are still moving at levels unexplored since April, driven by Russian and Saudi announcements on a reduction in their oil supply.
Oil is back on the front of the stage, reacting in recent days to a salvo of news. New tensions in the Black Sea arose over the weekend as Russia and Saudi Arabia announced an extension of their production cuts late last week.
Tensions in the Black Sea have indeed risen a notch in recent days. Latest news, a Russian tanker was hit overnight from Friday to Saturday by Ukrainian drones in the Kerch Strait.
The price of Brent hit its highest since mid-April, at 86.73 dollars on Sunday, in response to this renewed tension in the region. The prices of black gold were already well oriented last week after the decision of Saudi Arabia and Russia to carry out new production cuts.
Thursday, the world’s second largest producer of black gold announced to extend the reduction of its oil production by one million barrels per day by one month, until the end of September. A measure which could still be “extended” beyond this period, even “extended and reinforced”, indicated the Saudi ministry of Energy in a press release.
Russia followed suit the next day. The country has said it wants to cut its oil exports by 300,000 barrels a day in September, while it had planned to cut its production by 1 million barrels a day in September, compared to a cut of 500,000 barrels a day in August.
In addition, the cuts introduced by nine other OPEC+ member countries in May for a total of 1.6 million barrels per day have been maintained until the end of 2024, the day after the announcement of the extension of the reductions. Saudi production.
A little breath after the rise
For Jean-Pierre Favennec, oil specialist, the rebound in black gold prices should continue, noting that “the reductions [de production] work” and this, for simple reasons.
“There is agreement [de l’Arabie saoudite] with Russia and the global economic forecasts are not too bad, in any case they are better than a few months ago and there is a need for oil almost everywhere in the world”, he developed this Monday on Good Morning Business.
Quoted by AFP, Price Futures Group analyst Phil Flynn expects these restrictions to continue until the end of the year. “They feel that the market is dysfunctional” and that without the cuts, prices would not reflect oil fundamentals, as they did at the start of the year, the analyst told the agency. press. “We are on the way to 90 dollars” for Brent, he said, and did not rule out a rise in prices towards 100 dollars.
In the meantime, black gold prices are taking a break on Monday after their recent surge. A barrel of Brent from the North Sea, for delivery in October, lost 0.53% to 85.78 dollars and its American equivalent, a barrel of West Texas Intermediate (WTI), for delivery in September returned 0, 6% to $82.34.
Sabrina Sadgui – ©2023 BFM Bourse