New York oil at its lowest since 2002

New York (awp / afp) – The price of a barrel of oil quoted in New York fell on Friday by 8.1% to end at its lowest since January 2002 while it becomes more and more difficult to store crude at United States.

West Texas Intermediate barrel for May delivery was 18.27 dollars, down 1.60 dollars from Thursday’s close. Over the week, it plunged 19.7%.

An encouraging sign, however: the barrel of WTI for delivery in June, which will become the benchmark from Wednesday, fell only 2%, to end at 25.07 dollars.

The barrel of Brent North Sea for delivery in June, reference to London, for its part appreciated by 0.90%, or 26 cents to 28.08 dollars. Over the week, it lost 10.8%.

WTI’s barrel contract for delivery in May will soon expire, meaning that those who own it must find physical buyers. But the stocks have already swelled enormously in the United States in recent weeks and they have to sell their prices.

“The production cuts promised by OPEC (the Organization of the Petroleum Exporting Countries) and its allies must be implemented and the drop in production in the United States is not done quickly enough given the abundance black gold on the market, “notes Phil Flynn of Price Futures Group.

Certainly American production is decreasing, according to the latest figures from the American Energy Information Agency (EIA) published on Wednesday, but slower than demand, causing an explosion in stocks which threaten to overflow.

The International Energy Agency (IEA) has warned this week that global oil demand is expected to undergo a “historic” collapse of 9.3 million barrels per day (mbd) this year, and fall again in April to its lowest level in a quarter of a century.

The spread of the Covid-19 pandemic and the containment measures implemented around the world have grounded many planes, drastically reduced car journeys and paralyzed many factories.

China came to illustrate this harsh observation earlier today: its economy experienced a decline for the first time in its history in the 1st quarter, with a decline of 6.8% over one year.

However, “if we look at the prices of contracts that expire later in the year, the prices are more encouraging because investors are betting on a recovery of the American economy which should allow demand to recover”, estimates M. Flynn.

Donald Trump notably unveiled Thursday a plan to make “restart America” ​​in three stages, and to relaunch as quickly as possible the first world economy.

bp-jum / alb

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