› Dow Jones predicts the decline in output of OPEC

Dow Jones predicts the decline in output of OPEC

Dow Jones predicts the decline in output of OPEC
The primary effect of trading on Thursday, February 12th, 2016 was caused by pessimistic mood. However, the situation began to change shortly before the end. The quotes of WTI grade oil that day reached new lows again. The reason for that was the message from oil companies that they will reduce the throughput performance. Naturally, this will lead to a further filling of storages.

However, oil is not the only factor that disturbs the market. The situation with European banks also gives a reason for pessimism. The credit-default swaps of Credit Suisse Bank show sustainable growth.

As a result, the US Dow Jones index dropped by 400 points during the session. However, as noted above, by the end of the session the situation changed dramatically. United Arab Emirates officials said that OPEC is prepared to consider the cut the oil output. However, such statements have been heard throughout the month, but real steps on the part of the cartel have not yet been taken.

For a long time many oil producing companies have been scared by the oversupply of oil on the market. There is a real concern that the world’s storages will be overfilled in the nearest future. Accordingly, the oil prices may continue to decline. On the other hand, if OPEC does decide to cut the output, this could be a turning point in the current downward trend for hydrocarbon raw materials.

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