Christmas wreck: Brent plunges to $45
The global oil market is struck with panic today, despite the fact that the key exchanges - NYMEX in New York and ICE in London - are not working today.
As of 10:00 Moscow time, Brent crude futures were trading at $50.6 per barrel on the Moscow stock exchange, but at 10:40am the oil price declined to $44.95 per barrel.
As of now, the oil price bounced to $47.8 per barrel.
A leading analyst of the National Energy Security Fund, a lecturer at the Financial University under the Government of the Russian Federation, Igor Yushkov, speaking to Vestnik Kavkaza, noted that "all economies are interested in preventing a further decline. At the same time, the collapse still cannot excluded, as soon as the largest stock exchanges start their work again: everyone wants to come out with money. That is, what we see now on the MICEX is the problem of the common and economic situations," he explained.
"If in November the Brent oil price declined by $26 per barrel on the growth of production volumes, the development of shale projects and the accumulation of commercial reserves in the U.S., then now stock exchange indices are at fault, because oil prices are lowering after the indices. Today’s drop is not connected with the OPEC + deal. in fact, the U.S. Fed, which raises the rates. have an impact on the situation. When no one takes loans, no one spends money - there are no money left on the stock exchange, there is nothing to trade, demand drops. As a result, all the prices drop," Igor Yushkov noted.
"Now Brent oil price can drop to even $40 per barrel. Those with investments in futures are seeking to sell them, and oil from these sales will become even cheaper. We can only wait for the New Year, when OPEC + deal enters in force. The sanctions against Iran will come into force in March, Iranian oil will leave the market, so I think traders are waiting for this time to buy futures," the leading analyst of the National Energy Security Fund concluded.