The day of the reckoning is upon the oil industry. In the course of the afternoon, leading oil-producing countries plan to negotiate a cut in production. The aim is to find a solution to the price war between Saudi Arabia and Russia. Oil prices continue their recovery rally.
A barrel (159 liters) of the North Sea type Brent currently costs $ 33.99, around six percent more than the previous day. The price of a barrel of the American grade WTI rises ten percent to $ 26.11.
The recovery seems to go hand in hand with the hope of reaching a groundbreaking agreement at today’s Opec + conference (via video conference). The meeting was originally scheduled for Monday.
The Russian government had previously signaled its willingness to reduce daily production, which recently supported the recovery in the oil price.
Slump in demand puts an additional burden on the oil price
It remains questionable how sustainable the recovery will be, because in addition to the price war between Saudi Arabia and Russia, the lower oil demand is also having an impact on the price.
Market oanalysts spoke of a decline of 70% in some regions of the world. According to the government, only 14.4 million barrels a day are currently in demand in the United States, which would be the lowest level since 1990. The sharp drop in demand due to restrictions in numerous countries can also be seen in the overall view, according to traders : Normally, the world uses about 100 million barrels of oil a day, but some traders recently only spoke of 65 million barrels a day.
Everyone is currently looking forward to today’s Opec + conference. The extent to which an agreement is reached is still completely open – just as whether the cut in the production volume in the room is sufficient to sustainably raise the oil price above $ 30. Courageous investors with foresight can rely on such a scenario and gradually access the three dividend pearls.