The oil market is unstable at the beginning of a new trading week

Oil quotes show high volatility at the beginning of the new trading week in the price range of $85.65-86.50 per barrel. 

The current Brent quote is $85.67 per barrel, WTI oil is trading in the range of $81.70-82.60 per barrel. Last week, Brent rose by 1.4%, WTI – by 2.3%, and both types of oil rose in price for the fourth week in a row.

The market was supported by the forecast of the International Energy Agency published on Friday, according to which the supply deficit on the world market in the third quarter will amount to 2 million barrels per day. The IEA noted that another reduction in production by OPEC+ countries threatens a further decline in supply and an increase in oil prices at a time when inflationary pressure is already damaging consumers.

In the second quarter, the deficit will be 400 thousand b/d. Previously, the IEA expected demand to exceed supply only in the third quarter. The average deficit in 2023 is estimated at 800 thousand b/d.

At the same time, OPEC, which published its monthly forecast the day before the IEA, still expects an increase in oil demand in 2023 by 2.3 million barrels per day (up to 101.89 million b/d) – above the pre-Covid level.

Also today it became known that the countries of G7 intend to maintain the ceiling of prices for Russian oil at $60 per barrel.