08.10.2014 - Negative trend for oil will continue in the near future
The price of American benchmark Light Sweet crude oil continued its fall, and updated 17-month low. At the moment, there are several reasons for the drop. Thus, the demand for oil in Asia and Europe remains weak on increased oil production in the United States to the highest level since 1986 and in the OPEC countries - up to 30.96 million barrels last month, against the quota 30.00 million barrels. Negative factors has also become yesterday's drop in growth forecast for the world economy of the IMF analysts who expect an increase of 3.3%, which is 0.1% less than the previous forecast and 0.4% worse than the forecast made in April. At the next meeting, OPEC may decide to reduce the quota to maintain the oil price, but the price trend despite this is likely to remain negative. We expect a further decline in oil prices on the background of weak demand, the strengthening dollar and oversupply in the market.