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EIA also downgrades global crude oil demand increment forecast that international oil prices will fall by 20% in the past March.
Aug 7,2019
The content below was translated by Tencent automatically for reference.

SMM News: in the increase in global trade risks, as well as the continued concern about the growth of crude oil demand, the downward trend of international oil prices continues.

On August 7, the US Energy Information Administration (EIA) released a short-term energy outlook report, cutting its forecast for the increment of global crude oil demand in 2019 by 70000 barrels per day to 1 million barrels per day, the seventh consecutive month that EIA has reduced its forecast for the growth of global crude oil demand in 2019.

As of Aug. 7, Beijing time, WTI crude for September delivery fell 1.94 percent to close at $53.63 a barrel, while Brent crude for October delivery fell 1.45 percent to close at $58.94 a barrel.

The price is down nearly 20 per cent from its April high. In April, crude oil futures for WTI and Brent were as high as $66.33 and $75.22 per barrel, respectively.

Last week, US President Donald Trump threatened to impose tariffs, global trade risks soared, and the Federal Reserve cut interest rates less than expected, international oil prices plummeted on August 1.

On the same day, WTI crude oil futures fell 7.9 percent to close at $53.95 a barrel, the biggest drop since February 2015, while Brent crude oil futures fell 6.99 percent to close at $60.50 a barrel, the biggest drop since February 2016.

The global economic growth rate is declining, and the weak demand side has a growing impact on the market.

In early July this year, 14 OPEC members and 10 non-OPEC oil producers announced in Vienna that they would continue to implement the production reduction agreement until the end of March 2020. The news did not exceed market expectations, international oil prices still ushered in a fall.

While OPEC + maintained the reduction in production, the crude oil supply of non-OPEC + countries continued to grow. According to the Wall Street Journal, although previous hurricanes caused production losses in the Gulf of Mexico, shale oil and gas from the Permian and other regions will largely make up for those losses, according to the Wall Street Journal.

Us oil production will increase to 13 million barrels a day by early next year, up from the current 12 million barrels a day, according to EIA data.

At the same time, tensions in the Middle East continue to ferment, providing some support for the international crude oil market.

According to the Russian satellite news agency, on July 31, the Iranian military again seized a foreign oil tanker, it is not clear which country the tanker belongs to.

In the past month, the seizure of oil tankers has occurred frequently.

On 4 July, in the waters near Gibraltar, local authorities in Gibraltar, with the assistance of the British Navy, seized the Grace I tanker carrying Iranian crude oil on the grounds that it was carrying crude oil to Syria in violation of EU sanctions.

After several protests, Iran warned Britain that it would retaliate.

On July 14, the Iranian military intercepted a Panamanian-flagged tanker and accused the tanker of smuggling oil.

On July 19, Iran seized two oil tankers flying the flags of Britain and Liberia in the waters of the Persian Gulf.

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