Oil crumbles, but resists

(New York) Oil prices fell slightly due to profit-taking on Friday, but the market remains tense due to fears of an imbalance between supply and demand this year.



The price of a barrel of Brent from the North Sea for delivery in May fell 0.09% to $85.34.

A barrel of American West Texas Intermediate (WTI), due in April, lost 0.27%, to $81.04.

After recording a high of more than four months closing on Thursday, black gold opened the session with profit taking.

But as the day went on, he pulled himself together, to the point of finishing just one breath away from balance.

“Prices are driven by the anticipation of an upcoming deficit” in supply versus demand, explained Bart Melek of TD Securities, “with a restart of the global economy, support measures in China and continued production cuts within OPEC.” »

On Thursday, the International Energy Agency (IEA) revised its forecasts and warned that the market could be in deficit this year, adopting the hypothesis of an extension of OPEC + reductions until the end of 2024.

The Organization of the Petroleum Exporting Countries (OPEC) and its allies in the OPEC+ agreement have only committed, for now, to maintaining these levels until the end of June.

“The three major agencies are counting on a supply shortage in the second quarter,” said Barbara Lambrecht of Commerzbank in a note regarding the IEA, the American Energy Information Administration ( EIA) and OPEC.

But several analysts cast doubt on the scenario of OPEC+ volumes remaining at these levels until December.

TD Securities sees Saudi Arabia breaking ranks in the summer and increasing production.

As it stands, “they are losing market share,” recalls Bart Melek. “Once the market goes into deficit and if prices rise further, it is likely that they will take the initiative to fill” the lack of supply.

As for JPMorgan analysts, they question whether Russia’s promises to reduce its exports by 500,000 barrels per day will materialize, “given the country’s track record” in this area.

In addition to the IEA forecasts, the market was also supported by the marked strengthening of refined product prices.

The wholesale price of gasoline in the United States hit its highest level in nearly six months on Friday.

The EIA’s last two weekly reports have noted sustained demand for the fuel, unusual for this time of year.


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