what will happen to the PRICE after the oil collapse

The price of a barrel of crude oil in the United States fell and reached historical levels this Monday, due to the lack of demand for fuel in the world

The coronavirus pandemic that crushed fuel consumption and plunged the value of crude oil to unprecedented levels, will hit the production of the Vaca Muerta field but will not cause a drop in prices at suppliers, estimates sources in the local oil sector.

The oil crisis, prior to the spread of the coronavirus, has as its protagonists the countries that make up OPEC, on the one hand, and Russia, on the other.

The arrival of the coronavirus pandemic and quarantine pulverized the consumption of fuels in the world and led to a sharp increase in oil reserves in the United States, the largest consumer, who no longer has a place to store it, as in Argentina. .

The picture worsened even more after Saudi Arabia, which is part of the organization of oil nations, launched a price war against Russia, which is not part of the group.

While there was then an agreement in principle to lower the level of daily production, prices also continued to fall to historic levels on suspicion that the storage facilities in the United States are full.

According to data from the US Energy Information Administration, oil inventories rose by 19.25 million barrels last week.

However, and against all the forecasts, this abrupt decrease will not cause a drop in the prices of fuels that are traded in the local market, because the values ​​are measured from Brent crude, which has a more stable price.

The concern at the local level is given on two fronts: the excess of stock that makes maintenance and development of Vaca Muerta almost impossible.

Is that, according to experts in the energy sector, the continuity of the field depends on investments and those who have that decision will not be willing to disburse funds in a business that became very risky.

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Written by Argentina News

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