Oil futures fell modestly today, approaching to month low, as investors have less faith in the possibility of concluding the coordinated production limitation of oil-producing countries of the agreement.
Second Saudi Crown Prince Mohammed bin Salman said that Saudi Arabia has agreed to freeze the level of oil production only on the condition that Iran and other major manufacturers join the agreement. Such statements cast doubt on the success of the forthcoming meeting of the largest oil producers and caused negative on the market against the backdrop of Iran's refusal to freeze its current level of production.
Although current fundamentals are unlikely to support the price of oil above $ 45 a barrel, analysts assume that prices may fluctuate in the range of $ 30- $ 40 per barrel. Meanwhile, the data of the Commission on Trade in futures trading, showed that for the first time in the last six weeks of hedge funds last week cut their bullish bets on oil. On March 29, speculators trading on the New York Mercantile Exchange, held a short position in the 75,598,000 barrels of crude oil WTI ( 11,167 Mill. Barrels for the week). In addition, the rates were closed to the growth of oil prices in the amount of 3647 contracts (thousand barrels each). As a result, the net long position fell to 221,016 contracts.
"There is nothing surprising in a wave of profit-taking and some closing of long positions Some people even say that they could change the position to move to lower prices -. Said the chief energy economist ABN AMRO Hans van Cleef -. It is part of the normal cycle I think that such dynamics may continue this week. We could see $ 36 or $ 37. Prices are falling because of speculation that Saudi Arabia will not join the deal to freeze production. " Some analysts believe that the production record highs near freezing would reduce the surplus, given that demand is expected to continue to grow this year.
A small market was supported by comments of the Acting Minister of Kuwait Oil Anas Al-Saleh. Speaking to reporters, al-Saleh said that he hoped the coordination between OPEC and other oil-producing states, which, in his opinion, will help to stabilize oil prices.
WTI for delivery in May fell to $36.51 a barrel. Brent for May fell to $38.18 a barrel.