Oil prices define lower limit of the corridor

Baku. 27 Jully. REPORT.AZ/ The lower limit of the price corridor for Brent crude oil is set at $ 44/bbl. Analytical Group of Report News Agency notes that the price for Brent on January 18, 2016 fell back to $ 28/barrel, then increased 2.15 times during the year, on the first working day of January 1 up to 58.37 dollars/barrel. In July 2008, Brent crude oil traded at a record price of $147.50/barrel.

The prices, which peaked in the last 18 months in January prompted the growth of shale production in the US, where the number of active oil wells reached 764, increasing of 2.4 times, and oil production in past two years soared by 12% or 1 million barrels/day and reached 9.4 million barrels/day. It was reported by the American company Baker Hughes.

The increase in production in the US led to the fact that oil prices began to fall again. Rollback of prices on June 21 to 44.35 dollars/barrel caused a slowdown in shale production and a reduction in the number of active oil wells. So, for last 4 weeks in the USA the number of active oil wells has been decreasing for 2 weeks, and has remained stable for a week. Oil production last week fell by 0.2% or 19 thousand barrels - to 9.410 million barrels/day. Also last week, US oil inventories fell by 7.2 million barrels.

Analytical Group of Report News Agency believes, a level of $ 44/bbl may be taken as optimal for a smooth reduction in shale production in the US. Currently, price of Brent crude oil up to 51 dollars per barrel and is in search of the upper limit of corridor, after which the prices will stabilize. Analysts predict, this will happen in range of 47-48 USD/barrel.