Baku 23° C
Baku. 8 May. REPORT.AZ/ The price of oil in the world market reached the maximum for the last 3 years.
Analytical Group of Report informs, at present, the price of Brent crude is about $ 75/ bbl.
Price hike is due to the following factors:
- The United States refuses to sign an agreement with Iran and considering to impose sanctions against this country. This is a trigger signal for the market. The final decision on deal closure will be made by Trump administration on May 12.
- The economic crisis in Venezuela, one of the world's leading oil exporters, has deepened. This can reduce the offer on the market. Given the steady demand for oil, the situation in Venezuela will undoubtedly increase prices.
- Global economic growth has accelerated. For example, in 2017, the gross domestic product (GDP) in developed country like Japan increased by 0.4%. Last year, the European Union's economic growth was 2.4%, which was 0.4 percentage points higher than the previous year. High economic growth means an increase in oil demand. If this demand is not met, the price of "black gold" will inevitably rise.
- Along with oil the price of oil futures contracts is rising. These financial instruments are traded above $ 70 for the first time in the last 3 years. Specifically, over $ 70 per barrel of Texas (US) oil is a reason to say that United States will benefit from price hike most. This is due to the fact as a result of decline in the volume of oil production in Mexico and Venezuela the volume of US sales base has increased.
-The US Dollar Index has recently been increasing in contrast to the long-term downward trend. Dollar index reached its highest level ( 92,908 ) since December last year after growing interest in the US economy with oil price hike. Instead, the interest in other countries, including the EU countries, has dropped, and this is reflected in the euro exchange rate. Investors are interested in selling their assets in the euro and buying assets in the dollar.
