The price of Crude oil recorded a drastic increase to $45/barrel, on Monday evening and Tuesday’s morning barely 24hrs after the president, Organisation of Petroleum Exporting Countries Mohammad Al-Sada, gave market assurance that the price of oil will rise in September.
Mohammad Al-Sada on Monday said “higher oil demand is expected in the third and fourth quarters”, leading to higher prices.
e added that, since February of this year, the oil price had experienced a steady improvement following a decline in crude oil production, supply outages and a decrease in oil inventories, while the global demand for oil improved in that period.
After Al-Sada’s assurance, Brent crude, the international benchmark for oil, surged from $42 to $45.33 a barrel – nearly a three percent increase.
West Texas Intermediate (WTI) rose by 2.9 percent to climax at $43.02.
According to OPEC secretariat, OPEC basket price surged to $41.10 a barrel, against $40.08 before Al-Sada’s sentiment.
Al-Sada earlier said that the recent decline observed in oil prices and the current market volatility is only temporary.
“These are more of an outcome resulting from weaker refinery margins, inventory overhang – particularly of product stocks, timing of Brexit and its impact on the financial futures markets, including that of crude oil,” he said.
The minister said, the economies of major oil consuming countries are expected to improve which in turn would augment oil demand in the coming quarters, especially in preparation for the approaching winter season in the Northern Hemisphere.
The minister assured that OPEC continues to monitor developments closely, and is in constant deliberations with all member states on ways and means to help restore stability and order to the oil market.
Source: www.thecable.ng