Oil Prices Rise But Stay Below $30

Oil Prices Rise But Stay Below $30

Our sources still stand by that scenario from the Saudi perspective, while the Russians are getting media out there to the effect that the U.S.is about to lose the war over European market share.

The 59-year-old executive said other factors were also impacting the oil market, including coronavirus and sanctions.

Oil rose further Friday after a dramatic rebound from multi-year lows but stayed below $30 a barrel on fears the deadly coronavirus will push the world into recession with an oversupply.

"The uncertainty of what will happen is still an overhang and destabilizing markets", said Ryan Fitzmaurice, commodities strategist at Rabobank. "A deal between Texas and OPEC would have been unthinkable a few weeks ago".

The Opec production cuts, which have stabilised the oil markets for three years now, appear "unlikely given the recent breakdown" in relations between Russian Federation and Saudi Arabia, the central pillars of those cuts, he adds.

According to Daniel Yergin of IHS Markit, the fact that Trump's intervention is on the table is a sign of how dire the situation is for the industry. As long as the United States shale oil industry remains insecure and non-sustainable, Washington is dependent on external crude sources and hence can't fulfil its "long dream of less engagement in global geopolitics", the expert adds. The Department of Energy began purchasing 30m barrels of USA oil this week to fill the Strategic Petroleum Reserve - an emergency fuel store.

Widdershoven, on the contrary, advises POTUS against intervening in the Russia-Saudi-UAE negotiations on oil that he is confident are secretly ongoing.

"Such actions, if implemented, would reduce global and domestic supplies and help support prices in the near-term", says Jeffrey Currie, an oil analyst at Goldman Sachs.

In the medium-term, the viability of an intervention by Trump will also depend on the upcoming presidential elections, which could see a new occupant in the White House.

Saudi Arabia's Crown Prince Mohammad bin SalmanThe United States believes Saudi Arabia's flooding of oil markets compounds the coronavirus-caused global economic crash and intends to send a senior official to Riyadh for months to boost efforts to stabilize energy markets, senior US officials said on Friday.

However, he predicted oil prices would return to a range of between $50 and $60 a barrel by the end of the year as US shale producers are squeezed by the low-price environment.

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