Crude oil prices rose on Wednesday morning. Brent and WTI continue to consolidate near their maximum values in recent months. It should be noted that there are still many unresolved issues, which means that there is still potential for reduction of positions. It is especially important to pay attention to the latest report of the International Energy Agency (IEA), which will present all the possible difficulties that the raw materials market will have to face in 2021.
Recall that the IEA has changed its forecast for the level of demand for black gold in the new year in a negative direction. According to the latest data, it is worth waiting for a reduction in demand for crude oil by about 280,000 barrels per day, which will lower the previously presented figure to 5.5 million barrels per day. The main conclusion that the agency made is that the recovery in demand for raw materials will go at a slower pace than previously expected, which means that it will return to the previous level even later. The reason for such conclusions was the increasing lockdowns in a number of countries in Europe and other regions. The complex epidemiological situation in the world does not allow us to start the process of restoring the market of crude oil in the volume that analysts had previously expected. Fuel prices are particularly seriously affected by the introduction of tougher quarantine restrictions, which are under the strongest pressure. Its sales are declining again, which is evidence of a pullback. Thus, the forecast for the development of the oil products market for the current year has undergone a thorough revision and correction.
Moreover, according to new data, the demand for black gold in the first quarter of this year will fall by 0.6 million barrels per day, and in general, for the year, the decline may amount to 0.3 million barrels per day.
In any case, the first half of this year will be difficult for the hydrocarbon market, as the growth of coronavirus infection in the world continues at a rapid pace. Hopes that mass vaccinations can change this state of affairs are dwindling. The situation has become especially serious in the United States of America and in Europe. The increase in new cases of the disease in China, which until this moment managed to avoid another wave of the pandemic, also raises concerns. The country's authorities have already begun to make calls for citizens of the state to cancel their trips and contacts on the occasion of the celebration of the Lunar New Year.
Despite all the difficulties and problems, the International Energy Agency did not downgrade the overall estimate of the decrease in the level of demand for crude oil in 2021. The indicator still remains around 8.8 million barrels per day.
Many experts point to the fact that the outlined weakening of the US dollar may well support the level of oil prices and prices in all sectors of the commodity market. The news about the possible introduction of an expanded program of financial incentives in the United States is also viewed positively. However, there are still many questions regarding the latter.
Meanwhile, US authorities have already begun to make active calls to accelerate support for the country's economy and avoid an even greater collapse amid the crisis caused by the coronavirus pandemic. Lawmakers are trying to do everything to end the already protracted economic downturn.
The price of Brent crude oil futures contracts for March delivery on the trading floor in London rose 0.63% or $0.35, to $56.25 per barrel. Tuesday's trading also ended positively gaining 2.1% or $1.15, to $ 55.9 per barrel.
The price of futures contracts for WTI light crude oil for delivery in March on the electronic trading platform in New York also went up by 0.59% or $0.31, to $53.29 per barrel. Tuesday's trading session ended with an increase of 1.1% or $0.56, which sent the final price at $52.98 per barrel.
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