According to the Organization of the Petroleum Exporting Countries, in the 1st quarter the world consumed much more oil than production volumes.
So, it is no wonder that oil prices have been falling, especially taking into account uncertainties over Europe and decreasing trade balances of the USA and China, the world’s largest oil consumers.
In fact, the last OPEC report is indicative of growing demand for “black gold”. The forecast for world oil demand growth in 2012 has been revised up by 1% as compared to the previous year: the OPEC hiked it to 88 mln 670 thousand barrels per day.
At the same time, oil exporters increased production in order to prevent soaring prices for energy that tend to impose negative impact on the global economy.
Oil prices have recently rose as the EU is planning oil embargo on Iran, effective from July 1, 2012. Already in the 1st quarter oil exports to Japan, China and South Korea contracted.
The authorities of Iran are looking into the ways to preempt the sanctions. Oil exports are monopolized in Iran. If this sector is privatized, Iranian firms will have to make contracts with other companies directly. The Tehran government is looking forward to negotiations with the key Iranian oil consumers scheduled on May 23 hoping to avoid embargo.