D.he oil prices fell sharply at the start of the week. A barrel (159 liters) of North Sea Brent cost $ 36.65 on Monday morning, $ 1.29 less than on Friday. The price of a barrel of American West Texas Intermediate (WTI) fell $ 1.36 to $ 35.43. At the weekend, the fuel was again relatively cheap at petrol stations in Germany. As in the spring, some filling stations offered diesel for less than 1 euro per liter. On average, the diesel price on Sunday, according to figures from the Clever-Tanken internet portal, was 1.03 euros per liter, and that for Super E10 was 1.188 euros,
The general downward movement in the oil price during the second corona wave had already started in mid-October, at that time the price for American was still 40 dollars. Shortly before the elections in America on Tuesday, the crude oil markets were burdened by the deteriorating demand outlook in the corona crisis. In Europe’s largest economy, Germany, restrictions to contain the corona pandemic have once again been in force since the early hours of the morning. The situation is similar in many other European countries.
From the point of view of the raw materials experts of the trading house Oanda, the high level of uncertainty makes it difficult for the oil cartel Opec to make a decision on future production. Rapid decisions are unlikely to be made despite the recent price slide. Only a drop in the price of Brent oil below the $ 35 mark would force Opec to act. The ministers of the cartel meet regularly at the end of November.
In the course of the past week, the Brent price had plummeted by more than eight percent and that for American oil by about ten percent. One reason for the price slump is the recent worsening of the corona crisis. In addition to concerns about weak demand, the development of oil reserves in the United States also put price pressure on the oil market. In the past week, American oil production and stocks of crude oil rose sharply. Eugen Weinberg, Commerzbank’s oil specialist, spoke of a “sell-off on the oil market”. This put the oil cartel Opec and the allied oil states combined in Opec plus under pressure to act. Weinberg said that only a decisive reaction could prevent an even greater slump in oil prices. However, a further reduction in the delivery rate is currently unlikely.
In the spring, the corona pandemic even meant that the price of American oil had become negative.