The cost of Brent crude oil fell by 5%
The cost of September futures for North European Brent crude oil in trading on Monday, July 16, fell by more than 5%. This is evidenced by the data of the ICE intercontinental stock exchange.
The index began to decline from the middle of the day: at the high, the September futures for Brent oil traded at the maximum level of $ 75.37 per barrel, but at 21:00 Moscow time it fell to $ 71.53. The fall to the close of trading was 5%.
The fall in value on the stock exchange also affected the North American WTI: its August futures fell 4.42% compared to the previous day, to $ 68.02 per barrel.
"This is very similar to the ongoing reaction to the potential increase in supply [in the market]," Bart Malek, head of the international raw materials strategy at the Canadian investment bank TD Securities, explained to Bloomberg. "The combination of the side effect of the increase in supply and the potential decline in demand as a result of the trade problems that we fix drives people to accept some long-term oil rates right now."
The day before The Wall Street Journal reported that the US government is considering using its strategic oil reserve, if the expected increase in world oil production does not lead to lower prices. According to the publication, Washington is working out such a scenario against its call to other countries to increase the volumes of oil produced. The possibility of using oil reserves is also considered by a number of Western US allies, the newspaper wrote.
In early July, Bloomberg and Reuters, referring to sources, said that the United States had appealed to a number of OPEC countries to influence oil prices and increase hydrocarbon production by 1 million barrels. in a day. Last week, July 9, The Wall Street Journal quoted sources as saying that Saudi Arabia accepted the request of the American side and for the first time after a two-year limit increased its oil production.