by Jörg Billina, Euro on Sunday
The oil exporting countries (OPEC) and Russia (OPEC+) are lagging behind their agreed production figures. According to Reuters, the July daily gap was 2.9 million barrels. Although Saudi Arabia has increased production as decided, African countries such as Nigeria and Angola are reaching their capacity limits. Russia is also currently producing less than announced.
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Now Saudi Arabia also wants to throttle. Energy Minister Abdulaziz bin Salman hinted at a cut in production earlier in the week. The oil prices for the Brent and WTI grades and the prices of oil companies such as BP and Shell then rose significantly. On August 24, a barrel of Brent crude cost $100.77. A few days earlier, the black commodity was still trading at $91. In recent weeks, oil prices have come under significant pressure due to growing fears of a recession.
“Saudi Arabia may want to plan ahead in the event that the United States agrees to a renewal of the nuclear agreement with the producer country Iran,” says Carsten Fritsch from Commerzbank. Then the sanctions imposed by the western states would be lifted and Iran could supply the world market with oil again. The USA, the EU and the government in Tehran have recently been optimistic about reaching an agreement.
However, the analysis house S & P Global Commodity Insights assumes that a deal will not materialize this year. In addition, it would probably take 12 to 18 months after the conclusion of an agreement before Iran can increase its production capacity to four million barrels a day. The country currently produces 2.5 million barrels, but most of these are consumed in the country itself.
So far, oil investors have not had to fear Iran’s return to the world market. Investors who want to participate in the developments of oil companies can do so with the iShares Stoxx Europe 600 Oil & Gas ETF. The ETF includes 19 European stocks. Shell is weighted at around 29 percent and BP accounts for 14 percent. Since the start of the year, the ETF has gained six percent, and in one week it has increased by more than five percent.
New Boost: The ETF offers access to a total of 19 oil and gas companies from the European industrialized countries. Promising, but the price development is very volatile.
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