This week oil opened at a low caused by a number of factors. To begin with, OPEC and Russia are increasing oil production on account of how well crude oil has been performing this year. They consider that the oversupply issue is almost resolved, so they are preparing to once again increase their export levels and benefit from the high prices. Nevertheless, with more supply, the price has been pushed downward below the $70 per barrel level. The US light crude is down to $63.59 per barrel.
Moreover, Donald Trump’s trade disputes are also having an impact on the price of oil. Last week the US President announced the final decision to slap China with $50 billion worth of tariffs. In response China has announced their own retaliatory tariffs, which include crude oil from the United States. China is one of the biggest importers of oil, especially from the United States, so this could be a massive blow to the US.
OPEC will be meeting this Friday to discuss their future strategy for oil, in light of these recent developments.
