Oil Costs More Than $60.

2021-02-15   |   by CusiGO

It is unlikely that a temporary Arctic cold will hit Texas, which has become the latest catalyst for oil prices. Brent, the European benchmark, broke through $63 on Monday, and West Texas broke through $60, the highest level in the past 13 months. After that, the pandemic triggered a disaster and even reduced its price to a negative level last year. Texas is a typical oil state. Due to the impact of wind power generation, the storm caused supply problems and even led to power outages for residents. Concerns in the oil market about the closure of oil wells and the interruption of road transportation have been eliminated. “Forecasts show that this cooler than usual weather will continue to support gas and oil prices for most of the week, especially if we see a major disruption in supply,” ing analysts said in a report.

Monday’s increase of more than 1.5% was supported by other economic factors: workers at Norway’s largest oil terminal are considering a strike, which could disrupt production, and Saudi Arabia led Yemen coalition intercepted two drones loaded with explosives, This could exacerbate tensions in the region.

But in addition, there is still a basic trend of oil: it is expected that the global economy will recover in 2021 due to mass vaccination; big countries such as China and India will return to normal much faster than western countries; Low interest rates and a weak US dollar have led investors to switch to other assets, and production cuts by OPEC and OPEC + have paved the way for less supply.

Alexander Novak, Russia’s deputy prime minister, said price fluctuations had eased and that they were balanced and in line with “market conditions,” according to Reuters. The leader of Novak, one of the major producers, believes oil prices can stabilize between $45 and $60 a barrel.

So far this year, Brent crude has been revalued by 24% and West Texas crude by 27%. The breakthrough took place in an environment far from normal. Due to serious restrictions on tourism, air traffic did not return to normal levels. Ben van beurden, chief executive of Anglo Dutch Shell, believes that aviation fuel demand will play a key role in the future recovery and expects the industry to normalize in 2022.

Oil companies suffered huge losses in the year of the pandemic. Shell lost $21.68 billion (18.083 billion euros), which is very similar to BP’s loss figure of $20.305 billion (16.812 billion euros). The accounts of total and Chevron also fell: France lost $7.242 billion (5.982 billion) and the US $5.543 billion (4.576 billion).