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Global Oil Price may fall to $10/barrel as countries runs out of storage space


Muhammad UsmanMultimedia Journalist

25th Mar, 2020. 03:41 pm
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Oil markets

Global Oil Price: The countries may run out of oil space to store oil as Saudi Arabia prepares to increase its oil production even as demand for energy continues to fall amid coronavirus outbreak.
Oil storage levels across storage facilities have surged to 75% full since January shutdown of major refineries in China’s industrial heartlands.
Canada seems to be few days away from running out of storage for its local oil production, and other countries may follow trend in a coming months.
International oil prices fell to $25/barrel last week, from around $65 at the beginning of the year, and remains under $30/barrel. Credit ratings agency S&P has warned that the oil price could fall to $10 a barrel this year
The global surplus oil supply is expected to rise next month when an agreement between the Opec oil cartel and Russia to hold back oil production is due to end. The end of the deal would allow Saudi Arabia, Opec’s de facto leader, to race Russia to increase oil production in a bid to grab a greater share of the market.
The price war in oil industry will raise the world’s oil production by 2.5million barrels of oil per day.
“At the current storage filling rate, prices are destined to follow the same fate as they did in 1998, when Brent fell to an all-time low of less than $10 per barrel,” said Rystad Energy analyst Paola Rodriguez-Masiu

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