Oil markets have seen renewed volatility in the last 12 months amid economic uncertainty and a shifting output and demand picture. In recent weeks, investors have been treading cautiously amid concerns of a slowing global economy, particularly concerns over a China slowdown. Slower growth correlates with a decline in demand for oil.
The supply of global oil is also being closely watched by oil market analysts with the growth in production of U.S. shale oil also a pressure on prices. A growth in oil supply and falling demand causes prices to slump. To mitigate falling prices, OPEC and non-OPEC producers including Russia announced in December that they would be scaling back production.
Prices remain subdued, however, with benchmark Brent crude oil futures trading around $60.79 a barrel Thursday morning and West Texas Intermediate (WTI) at $52.33 a barrel.
Political risks have been sharply in focus for oil markets although much-discussed U.S. sanctions on Iran, imposed last November, failed to have that much of an effect on global supply as a handful of waivers were granted to oil importing countries, like Japan and India, allowing them to continue to buy oil from Iran.
Ironically, the smaller-than-expected impact from Iran, coupled with an increase in output from other OPEC nations and Russia aimed at mitigating the expected shortfall in Iranian supply, contributed to concerns of a glut in supply and hence prompted a decline in oil prices since the end of October.
from Just News Viral http://bit.ly/2T5GZwA
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