The oil market witnessed the accelerated slip in trading on Tuesday as the administration of Donald Trump, as reported, held confidential discussions with OPEC, which asked the cartel to raise oil production.
By 14.48 MSK, the price of Brent on the ICE London stock exchange plunged to the point of $73.86 per barrel, a tumble since the May 8 low. For the day, the quotations decreased by 1.95$, in three day- by 5.1%, and compared to the edges of the end of May- by almost 10%.
The American variety WTI decreased 11% in two weeks, and on Tuesday, July contracts were at $64.26 per barrel0 the lowest price since April 11.
As cited by the Trump administration in Bloomberg, The US authority asked Saudi Arabia and some other OPEC countries with a non-public request to raise oil production by about 1 million barrels per day.
Dissatisfaction of the While House engendered an increase in gasoline prices in the US to edges in 3 years. President Donald Trump, in May, condemned OPEC’s regulation on Twitter, accusing the cartel of artificially inflating quotes.
It was the force from the States that triggered the suggestion to raise supplies, which was pronounced at the end of May by Saudi Arabia and Russia.
The requisition of the White House was talked about at a conference of oil ministers of the Arab states, which was organized in Kuwait at the end of last week, sources cited Bloomberg.
As a result, Saudi Arabia, Oman, Kuwait, the UAE and Algeria pronounced the need to raise investment in production volume to pave the way for stable and timely oil supplies, growing demand satisfied and compensation for the decline in production in some countries. Hedge funds and large speculators are in store for the bad news: in 1.5 months they sold almost 350 million barrels in the futures market, terminating positions on the growth of quotations and opening- for their fall.
The net long position of hedge funds, at the New York Stock Exchange, slipped 1.8 times, to 342.2 million barrels, which is regarded the lowest point since July last year.
The funds, in the last reporting weeks, dragged down the rates for price growth by another 10% and raised by 29%- on their fall, the statistics of the Commodity Futures Trading Commission (CFTC) follows.
The fact that Saudi Arabia and Russia get going discussing the increase in production earlier than expected became a bit of a surprise, according to manager Manulife Asset Management LLC in Boston.