7x24HoursNewsflash

Nov 25,

2021 11:15 GMT
Brian
Fears that Opec will retaliate against the United States, further reducing production capacity and leading to higher prices; ① According to foreign media reports, the United States and other net oil importers have made their threats a reality. Washington announced it would work with several countries to release their strategic petroleum reserves. However, such action could end up backfiring. Strategic reserves make up a relatively small proportion of the crude oil market, so their impact on oil prices is limited in time and quantity. Opec, meanwhile, is considering a new strategy in the face of "hostility" from importing countries. A campaign to lower prices could turn into a new oil crisis; ② Reports say Opec has threatened retaliation. The release of reserves could satisfy demand for oil for a few days, but Opec's anger could have a more lasting impact on oil prices. Opec and its Allies, notably Russia, see current crude prices as reasonable and are likely to reduce production capacity further to offset the release of reserves in order to maintain balance. The end result could be less world oil production, smaller emergency stockpiles and higher crude prices

* Guidance is for reference only, not as a basis for trading