The price of crude oil continued its negative dynamics on Monday. This decline remains due to the sharp and significant increase in the number of COVID-19 patients in the world.
On average, the growth in three days has become significantly increase and reached 242,000 new COVID patients. It should be noted that a particularly serious increase occurs in the United States of America accounting for approximately 30% of the total number of cases in the country.
Last week, the US faced growth which led to a new negative record where by the end of week, the level of daily growth reached the mark of 77,000 COVID patients. However, it is worth noting that during the second wave of the pandemic, mortality from coronavirus infection and its consequences decreased significantly, which could comfort market participants a little.
Another pressure factor was an increase in the amount of oil produced under an agreement with OPEC, which was finally decided at a meeting of the organization's ministers last week. Of course, this fact did not become news for investors, since it was announced about it from the very signing of the package of documents between the countries, but the current epidemiological situation made us worried about the increase in production. Some analysts believe that this will nevertheless lead to an excess of supply in the oil market and that the demand that has just begun to strengthen will collapse again.
There are, however, positive aspects of the raw materials. The number of operating stations for oil and gas production in the United States of America decreased by another five units last week. Thus, their total number is now 253 units. Note that for the same period last year there were a total of 954 units which is greater than that of the current year.
The reduction was also noted for oil-producing stations, which decreased by one unit, and their total number turned out to be at around 180 units. Last year's figure was at the level of 779 units.
In total, the rigs are being phased out for the eighteenth consecutive week, hinting at an impending cut in crude oil production that should support the overall black gold market.
Meanwhile, imports of hydrocarbons in Japan in the first month of summer fell by 14.7% on an annual basis. This indicator turned out to be much better than the previous data. In May, the decline in Japanese imports of black gold amounted to a record 25%.
The price of Brent crude oil futures for September delivery on a trading floor in London showed a decrease of 0.67% or $ 0.29, which moved it to the area of $ 42.85 per barrel. Friday's trading also ended with a negative trend declining to 0.5% or 0.23 dollars.
The price of WTI light crude oil futures contracts for delivery in August in the New York trading floor fell 0.67% or $ 0.27. Thus, the raw materials moved to the mark of $40.32 per barrel. Friday's trading also ended with a reduction, which, however, was not so significant with 0.4% or $0.16.
In general, a decrease in the cost of Brent crude oil by 0.2% was noted last week. On the other hand, the cost of light WTI oil, on the contrary, slightly increased by 0.1%, however, this insignificant positive still suggests that the fall will not be catastrophic, but only reflect a temporary correction.
Most experts agree that the price of black gold has reached its maximum decline today, which suggests that growth should begin in the coming days, which is projected to be quite protracted if external factors do not intervene again.