Crude Oil Prices Fell by 4% on Monday as World’s Oil Producers Decided to Push for Higher Output

Trading | 5 months ago


Crude Oil Prices Fell by 4% on Monday as World’s Oil Producers Decided to Push for Higher Output - tradeglobalmarket

In a meeting held on 1st April, the world's oil producers (Organization of the Petroleum Exporting Countries) decided to push for higher output over the next quarter. As a result, the Brent crude Which is the International benchmark for crude oil prices Is currently trading at $62.06 per barrel for a 4.50% decrease after closing Friday at $65.12 a barrel.

BCOUSD - Daily Crude Oil Prices

BCOUSD - Daily Crude Oil Prices

The Meeting emphasized the ongoing positive contributions of the Declaration of Cooperation (DoC) in supporting a rebalancing of the global oil market after the heavy economic toll caused by the pandemic. The world’s oil producers approved the adjustments of the production levels for the next three months – May, June and July 2021. After these announcements, crude oil prices fell by more than 4% on Monday.

Oil has recovered from the historic lows in the month of March. There is no further recovery that is expected to gather pace in the next quarter. However, there seems to be some positive signals that could eventually lead to more supply of oil as investors are looking at the indirect dialogue between Iran and the United states to find a way to end the two-year-old U.S. sanctions imposed by the former Trump administration.

If the oil price moves down below the 50-day EMA, roughly near the $61.50 level, then we can expect the market may go down to the $60 level, and then eventually down to the $55 level. One must look for short-term selling opportunities in Oil CFDs as OPEC Nations has announced that they are looking to increase production.


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