Falling prices for oil and markets completely indifferent to cuts announced by Opec Plus. WTI crude fell below $20 a barrel, down 2,88% to $19,55, the lowest level since 2002. Brent crude is around $28, down 4%.
On the one hand, the pejorative estimates of the IMF on the global economy and the crisis generated by the Coronavirus triggered sales; on the other hand, the new estimates released by the International Energy Agency (IEA): it estimated that the demand for crude oil should drop by 9,3 million barrels per day due to the economic impact of the current pandemic. According to the IEA in April, a drop of 29 million barrels per day must be taken into account, a figure never seen in the last 25 years.
The IEA had words of appreciation for the production cuts agreed last weekend by the world's major oil producers and yet noted that there are no production cuts capable of stemming such a sudden collapse in global demand. In addition to the reduction in daily production, he nevertheless observed, it is positive that countries such as China, the USA, India and South Korea have shown the possibility of further cuts or in any case of resorting to the transfer of stocks to strategic reserves. In fact, if the transfers to strategic storages – valued at around 200 million barrels – were made in the next three months, the IEA noted, the transfer would represent around 2 million barrels/day transferred from the market.
The decline recorded so far will bring i world consumption at the level of 2012, settling at around 90,6 million barrels per day, estimates the Agency, which also expects a "gradual" recovery during the second half of 2020.
Forecasts that lead some operators to consider the production cut decided in recent days by the Opec countries to be insufficient. The May future on the Wti thus dropped 2,73% to 19,56 dollars a barrel after having reached the new low since January 2002 at 19,22 dollars. June delivery on Brent crude dropped 3,89% to $28,45.
