The race for the price of oil continues: after it significantly strengthened earlier this year and was close to the level of $80 per barrel, oil has suffered again over the past weeks. Right now we see a stabilization of oil prices near the level of $72 per barrel.
The price of oil is currently balanced by two opposing factors. Firstly, there is a decrease in the demand for oil because of lower economic growth in China and the European Union; this would usually push prices down because lower demand would translate into oversupply. However, the price is kept stable because supply is being curbed at the same time. This is due to the recently reinstated sanctions against Iran, who is the third largest oil exporter in OPEC.
The Brent crude was trading at around $72.11 earlier today, while the WTI was at $65.94.
The state of demand will chiefly be decided by how the trade war between the United States and China would go. So far growth was negatively impacted by their conflict, but the two countries are expected to renew negotiations later this month. This might alleviate some pressures and allow for more growth in the global economy.
