The crude stocks in the US escalated by about 11 million barrels previous week. However, the analyst projected an increase of 3.4 million barrels. The crude oil supplies hit new heights with its prices tumbling even further. The crude oil has been the most volatile market over the past 3 years and has witnessed another steep fluctuation on 8 April when massive stockpiles of crude oil in the US pulled down oil prices. The plunge in oil price was triggered by U.S. Energy Information Administration’s report that indicated, crude stocks of the country mounted steeply thereby marking the biggest rise in last 14 years.
The unprecedented addition to the oil supplies outlined the persisting supply glut and thereby forced the oil prices to reach its 6 year lows earlier in 2015. The sell-off led by price decline eroded away the gains stimulated by analyst projections that escalating US oil stocks are expected to start sliding in the second half of the year.
The oil & gas industry is experiencing the wave of high volatility in crude oil prices. While, the declining prices provided relief to the consumers but more than 50% plummet in crude oil prices have knocked the energy companies and oil-exporting nations which in turn distressed their economy.
Saudi Arabia’s crude oil production picked up the highest momentum in March stimulated by robust demand from foreign refineries and enhanced domestic capacity. The country’s oil production rose to 10.3 million barrels per day in March 2015, even higher than its recent record of 10.2 million barrels per day. The continuous increase in crude oil production by Saudi Arabia reaffirms its vow, not to give up its market share to US shale producers or to Russian drillers.
The huge gigantic crude oil stock aggravates the concerns that the US might soon reach its full storage capacity that could further pressurise the prices downward. In case the US inventory levels attain its full storage capacity, the drillers will be forced to reduce the pace of shale oil production. However, enhancing the refinery production can help in reducing its high storage.
The energy companies also have cut down their capital investments plan and the number of rig counts have also declined steeply. But these steps are yet to lower the US oil production due to its growing efficiency. According to EIA projections, the crude oil production is likely to start its downward movement by June 2015. However, Saudi Arabia’s oil minister Ali Al-Naimi, stated that Saudi Arabia’s oil production would stay at around 10 million barrel per day. This is an indication that the country is well determined not to cut its production and survive the price decline. Besides, many other elements that led to volatility in crude oil prices are Iran’s nuclear talks, disturbance in Yemen, huge fluctuations in currency markets and signs of resilient oil demand.
The unprecedented addition to the oil supplies outlined the persisting supply glut and thereby forced the oil prices to reach its 6 year lows earlier in 2015. The sell-off led by price decline eroded away the gains stimulated by analyst projections that escalating US oil stocks are expected to start sliding in the second half of the year.
The oil & gas industry is experiencing the wave of high volatility in crude oil prices. While, the declining prices provided relief to the consumers but more than 50% plummet in crude oil prices have knocked the energy companies and oil-exporting nations which in turn distressed their economy.
Saudi Arabia’s crude oil production picked up the highest momentum in March stimulated by robust demand from foreign refineries and enhanced domestic capacity. The country’s oil production rose to 10.3 million barrels per day in March 2015, even higher than its recent record of 10.2 million barrels per day. The continuous increase in crude oil production by Saudi Arabia reaffirms its vow, not to give up its market share to US shale producers or to Russian drillers.
The huge gigantic crude oil stock aggravates the concerns that the US might soon reach its full storage capacity that could further pressurise the prices downward. In case the US inventory levels attain its full storage capacity, the drillers will be forced to reduce the pace of shale oil production. However, enhancing the refinery production can help in reducing its high storage.
The energy companies also have cut down their capital investments plan and the number of rig counts have also declined steeply. But these steps are yet to lower the US oil production due to its growing efficiency. According to EIA projections, the crude oil production is likely to start its downward movement by June 2015. However, Saudi Arabia’s oil minister Ali Al-Naimi, stated that Saudi Arabia’s oil production would stay at around 10 million barrel per day. This is an indication that the country is well determined not to cut its production and survive the price decline. Besides, many other elements that led to volatility in crude oil prices are Iran’s nuclear talks, disturbance in Yemen, huge fluctuations in currency markets and signs of resilient oil demand.
