On oil exchanges, calming moods

Oil on the New York Stock Exchange slightly increases after last week dropped by as much as 13%. Investors are assessing the situation with regard to the Covid-19 epidemic in China and the prospect of additional oil supplies emerging from strategic reserves, say brokers.

West Oil Barrel Texas Intermediate in May deliveries cost $99.38 at NYMEX in New York City, higher 0.11%, after a decrease in last week by 13%, which is the largest weekly loss in percentage since IV 202.

The oil Brent on ICE in London in deliveries for May is valued at US$104.62 per barrel, higher by 0.22%.

Investors reflect on the prospect of fuel demand when China's new wave Covid-19 epidemic, which may reduce oil demand.

The population of Shanghai is 25 million people in some form of isolation, as more than 13,000 Covid-19 infections have recently been reported in China and the state media have reported an infection with another new coronavirus.

In the meantime, the markets are awaiting larger oil deliveries after the President of the United States announced last week Joe Biden's plan to lower raw material prices and achieve energy independence.

The United States will release 180 million barrels of oil from its strategic reserve (SPR) for the next 6 months and want to force oil companies to increase their raw material extraction.

An average million barrels will be released from the strategic oil reserve every day for the next six months.

"It seems that the move with SPR in the U.S. broke strong oil price increases," indicated Vandan Hari, co-founder of Vanda Insights consulting company.

Meanwhile, Vitol, the world's largest independent oil trading company, estimates that oil prices on global markets have now fallen to levels that do not reflect risks, including disruptions in Russian oil exports.

Soon Saudi Arabia is to announce the prices of its oil for raw materials cargo in May to Asian countries.

According to a survey by Bloomberg among traders and refineries, they expect a valuation of the key Saudi Arab Light oil for Asian countries at a record high level, as many buyers are already looking for an alternative to Russian oil, due to the Russian invasion in progress in Ukraine, which has been reflected in the oil markets for over a month.

Saudi Arabia is likely to raise the Arab Light oil price by $5 per barrel.

Source: PAP