The oil prices in the global markets are seeing continuous dip since April-end despite fall in the production, on the back of trade war between US and China. The benchmark Brent crude, at the time of filing this copy, was trading at $60.77 a barrel, down 18.5% from $74.57 a barrel on April 24, 2019. This is the lowest Brent has touched since January this year
During this period, oil production has also come down despite the geopolitical risks. The US’s ending of sanctions waivers for some of Iran’s largest crude importers on May 2, as it vowed to bring Iranian exports down to “zero”, threatens to intensify global supply constraints amid the OPEC production cut agreement.
Also, the probability of continued low or declining supplies among oil producers such as Venezuela (socio-economic strife and sanctions), Libya (civil-military conflict and amid a brink of breakdown), Canada (production restraint) and Russia (pipeline contamination) remains acute. Read more