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Oil prices will not fall below $100 mark for rest of 2014

KUWAIT CITY, Aug 31, (KUNA): There should be no anxiety over the global price of oil for the rest of 2014, predicted an expert, who viewed that prices would not fall below the $ 100 mark in spite of their recent drop to just below that. The recent drop as Kuwaiti crude slid by 64 cents to $ 99.14 a barrel is attributed to several factors, including supply exceeding demand, Mohammad Al-Shatti suggested. One of the main reasons of this is the significant increase of global production leading to an overwhelming output, he argues. The recovery of production in Libya, after their recent political revolution, has increased output from 70,000 barrels a day to around 550,000 barrels. 

Meanwhile in Iraq, production has not been affected by the threat of armed terror Islamic State jihadists, formerly known as ISIL, while production in Saudi Arabia has increased considerably. Member nations of the international producing bloc, OPEC, have also increased their production as have non-member states, which include Libya, Nigeria and Angola.
 
Despite the severity of geopolitical events worldwide their effects on crude supply have been limited and almost non-existent, he added. Other factors are linked to the decline witnessed in growth figures for the first and second largest global economies — the US and China — thus leading to weaker demand. On his predictions that prices would not fall below $ 100, he added that with winter at the doors, fuel will be needed for heating and thus an increase in demand. And the political crises in Iraq, Libya and Ukraine will also keep prices drifting around that figure.

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