While oil supply is expected to increase in the coming months, Brent and WTI prices are falling.
Oil prices are stalling after their recent spike. While supply is expected to increase soon and demand remains burdened by the fallout of the Covid-19 crisis, Brent and WTI are losing nearly 1%, to 49 and 46 dollars respectively. “The fall in oil prices this morning is a perfect example of a correction after a series of news that caused the market to rise too high” last week, commented Rystad analyst Bjornar Tonhaugen. As the supply of black gold is likely to increase in the near future, this showers the momentum of the past week, according to him. “The number of oil platforms increasing every week in the United States, Libyan production, which is slowly increasing to its full potential, and that of Iran, which is preparing to restart in the first quarter of 2021,” he explained in a note.

The offer of the members of the Organization of Petroleum Exporting Countries (OPEC) plus ten producing allies, identified by the acronym Opep+, is also expected to rise as of January 1. The cartel, which is forcing drastic cuts in its black gold production, agreed on Thursday to bring 500,000 barrels per day back to the market next month, after four days of tough negotiations. Despite the prospects that massive vaccination campaigns against Covid-19 hold out for demand, the current situation remains worrying. For example, the United States continues to register a very high number of daily cases of coronavirus: the country most heavily affected by the epidemic (more than 282,000 deaths) recorded some 181,000 new cases and 1,110 deaths related to the coronavirus on Sunday, according to figures from Johns