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The oil industry ignored the U.S. call for OPEC to “open the gate” to increase production

The Oil Industry Ignore : U.S. crude oil hovered around 68.08 in Asia. Oil prices fell last Friday, but the weekly line did not change much after banks expressed doubts about oil demand, and the International Energy Agency (IEA) warned that the spread of mutant virus was slowing oil demand.

U.S. consumer confidence fell to its lowest level in nearly a decade in early August The Oil Industry Ignored as Americans raised concerns about economic outlook, inflation and the recent surge in coronavirus cases.

Data released on Friday showed that the initial value of the University of Michigan Consumer Confidence Index fell 11 points to 70.2 points, the lowest since December 2011. This figure is far lower than the estimates of all economists surveyed by Bloomberg.

If consumers control spending next, the decline in confidence may bring a more obvious slowdown in economic growth in the coming months. The recent deterioration in consumer confidence highlights the blow to American sentiment by rising prices and concerns about the potential economic impact of the Delta mutant virus.

The Oil Industry Ignored The U.S. “Consumers think economic performance will cool down in the coming months, but the unusual spike in negative economic assessments also reflects an emotional response, primarily dashed hopes that the pandemic will soon end,” Richard Curtin, the director of the survey, said in the report.

The index is expected to fall nearly 14 points to 65.2 points, the lowest since October 2013. An indicator that measures consumers’ outlook for the economy for the coming year has deteriorated, with the biggest drop since the outbreak of March 2020. Consumers have also become obviously pessimistic about the income prospects. The expected index of personal financial status fell to a seven-year low.

According to the survey conducted from July 28 to August 11, the current situation index fell to 77.9, the lowest since April last year. “The Oil Industry Ignored The U.S.”

Consumers expect inflation to reach 3% over the next five to 10 years, up from the previous month’s forecast of 2.8% and comparable to the highest level since 2013. They expect prices to rise by 4.6% in the coming year, slightly lower than the 4.7% forecast forecast in July.

Concerns about mutant viruses have increased in recent weeks. Some U.S. cities have reintroduced mask requirements, and events such as the upcoming New York International Auto Show have been cancelled. At the same time, Alphabet Inc. Google, Amazon and Blacked have recently postponed their plans to return to the office. The data also shows that the purchase status indicator has deteriorated to its lowest level since April last year.

The U.S. government called on the Organization of Petroleum Exporting Countries (OPEC) to “open the gate” to increase production to support the global economic recovery, but The Oil Industry Ignored The U.S. the world’s largest oil industry forecasting agency did not “help”. Instead of shouting for the Biden administration to increase production, they have lowered the OPEC oil production expectations needed to maintain market equilibrium in the next few quarters.

The International Energy Agency (IEA), the U.S. Energy Information Administration (EIA) and OPEC have lowered their demand for OPEC crude oil almost every quarter before the end of 2022. Of the 18 expectations, only two were raised, and the extent was small.

Compared with a month ago The Oil Industry Ignored The U.S., Paris-based IEA and OPEC both believe that the crude oil supply growth of non-OPEC member states will be stronger. But this largely reflects the supply agreement reached by OPEC+ oil-producing countries on the 18th of that month, shortly after the release of the forecast in July. Under the agreement, OPEC’s overall output target will be increased by 400,000 barrels per day per month until all production cuts in 2020 are fully resumed. If further adjustments are not made, the process is expected to continue until September 2022.

In this month’s production increase plan, nearly 150,000 barrels per day came from non-OPEC member states in OPEC+, and Russia alone contributed more than 100,000 barrels per day.

But the increase in production in non-OPEC countries is not the only problem that OPEC countries will face in the coming months. The IEA pointed out that the current slow growth of oil demand than the assessment a month ago, coupled with the increase in non-OPEC supply, will further squeeze OPEC countries. The IEA said that global oil demand “slied sharply” last month, and soared by 3.8 million barrels per day in June, falling slightly. The agency lowered its global oil demand forecast for the second half of this year by 550,000 barrels per day based on its forecast a month ago.

The Oil Industry Ignored The U.S. Open oil production gate But not all institutions are so pessimistic. The EIA only slightly lowered its demand forecast for the fourth quarter, by only 90,000 barrels per day, while OPEC basically maintained its demand outlook for the rest of the year last month.

John Kilduff, partner of Again Capital LLC, said, “Although the IEA report poured a lot of cold water on demand, it is obvious that there will be a shortage of supplies in the short term, and as we see the United States relax air travel restrictions, this situation is likely to continue. Go.”

The commodity research departments of large banks Goldman Sachs and JPMorgan Chase’ bullish position on oil has weakened due to the rising infection rate. Goldman Sachs has reduced the global oil supply gap estimate from 2.3 million barrels per day to 1 million barrels per day in the short term, saying that demand is expected to decline in August and September.

The number of active oil rigs in the United States increased by 10 to 397 last week, the highest since April 2020, compared with 172 a year ago, according to Baker Hughes, an energy services company, and the lowest level before the shale oil boom boosted drilling activities in 2005.

The U.S. stock market hit an all-time high again on Friday, although data showed that U.S. consumer confidence fell to a nearly 10-year low. The market shows a narrow fluctuation pattern throughout the day. The consumer necessities and real estate sectors led the rise, and energy and financial stocks fell. Since the epidemic low in March last year, the S&P 500 index has almost doubled, and energy stocks have increased the most during this period. Miller Tabak + Co. Matt Maley, chief market strategist, said, “It’s just a light summer Friday; the financial season is largely over, and people have to breathe.”

Industry sources said that refineries of South Korea and Asia’s largest refinery took advantage of the decline in oil prices in recent weeks to snap up at least 5 million barrels of US Mars crude shipped in September.

Sources said that the continuous production restrictions of Middle Eastern oil-producing countries and Iran’s delay in returning production to the international market have also led to a warming of Asian interest in buying high-sulphur crude oil in the United States.

They said that a South Korean refinery bought 3 million barrels of the sulfurous crude oil, while Asia’s largest refiner bought at least 2 million barrels. Scott Shelton, an energy expert at United ICAP, said, “U.S. crude oil has become quite cheap compared with the rest of the world, and U.S. exports have rebounded as a result.”

Traders said that the discount of Mars sulfur crude oil on U.S. crude oil futures expanded to the highest level since April 2020, but has since narrowed due to increased export demand.

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