Oil has recently demonstrated the highest volatility among all asset classes in global markets. Today, prices are down sharply after rising almost 11% from the previous week. Analysts doubt that the upcoming talks of the world producers of “black gold” will solve the oversupply problem and said that the sharp rise in oil prices in August are not fundamental.
The prices of oil at $ 50 a barrel or above are unstable due to the ongoing overproduction and excess inventory in the energy markets, and are likely to experience another short-term dip in the coming weeks, Barclays analysts wrote.
The recent rebound of oil prices is more technical than fundamental in nature, according to Morgan Stanley. “In fact, new buyers are virtually absent during the last few months,” – said in a research.
Another fact that confirms the saturation of the world’s oil supply, was the growth of drilling rigs in the United States for another ten units last week. Compared with May the minimum number of installations has increased by 28%.
In addition, Iraq plans to increase oil exports by 5%, increasing the volume of exports of refined petroleum products from China and the strengthening of the dollar is also not in favor of the further growth of oil prices.
The cost of the October futures for WTI fell to 47.09 dollars per barrel.
October futures for Brent fell to 49.16 dollars a barrel on the London Stock Exchange ICE Futures Europe.
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