Oil Petroleum prices fell hard during this Monday’s trading sessions. Traders are still not done digesting the increase in US stockpiles reported by the EIA and API last week.
The market started the week with a strong hangover from last week’s inventory reports. Unfortunately for traders, OPEC and US-China trade war news also added up to its fall.
Both Brent oil and WTI crude prices nosedived this Monday’s sessions by over 1%.
West Texas Intermediate or WTI crude oil prices went down 1.08% or 0.62 points this early Monday trading. WTI crude barrels now trade for $56.62, jumping lower from its last close of $57.24.
Meanwhile, the Atlantic region’s benchmark for oil prices, Brent futures, fell 1.09% or 0.68 points in today’s sessions.
Brent oil barrels currently trade for $61.83 and has extended its losses from $62.31 to $61.80.
If both the EIA and the API reports another build-up in stocks this week, oil petroleum prices will continue to fall.
The American Petroleum Institute will first release its oil inventory report on Tuesday. The US Energy Information Administration then will follow on Wednesday.
Oil petroleum traders are worried about the oversupply and the week demand domestically and globally. The declining demand can be traced from the faltering economic activities across the globe. The weak economic performance then reinforces the concerns of a global economic slowdown.
Last week, traders were on with the risk-on sentiment over the growing hopes for a trade deal.
Discoveries in the Middle East
Elsewhere in the crude market, traders are also reading about the recent findings in the Middle Eastern country, Iran. Tehran recently came upon a massive oil petroleum field in Khuzestan, Iran.
However, sanctions against the country’s crude products might make things complicated for Tehran. The sanctions may prevent new oil to make its way into international markets.
Yesterday, Iranian President Hassan Rouhani announced the discovery in the southwestern province.
President Rouhani said the news oil petroleum field may have more over 50 billion barrels of crude oil. If the country finds a way to access it and gain international attention, it could help bolster the country’s economy.
The Iranian president then said that the new discovery is a mere gift from the government to its people.
If the government establishes a refinery in the area, it will be the second-largest oil field in the country. The biggest field in Iran is currently the Ahvaz oil field which has 65 billion barrels worth of crude oil.
Solving the Problem?
Sunday’s announcement came days after the Islamic republic said it would start enriching Uranium. The new plan is another breach in the controversial 2015 nuclear deal.
The oil petroleum sanctions and the rising tensions between Iran and other countries can be all traced back to the deal.
US levies are currently crushing Iran’s economy, targeting the country’s energy sector. The international sanctions prevent Iranian oil from making its way to foreign markets.
In the wake of the 2015 nuclear deal, oil petroleum has been one of the country’s major source of income.
Other officials have tried to save the nuclear deal ever since US President Donald Trump withdrew. However, the latest decision of Iran about uranium enrichment could make it tougher to reach an agreement.