Oil prices fall to lows of 2004

Oil prices fall to lows of 2004

This reduction is due to fears of an oversupply of raw materials on the market amid reports American oil and gas service company Baker Hughes on the dynamics of drilling rigs for the week.

MOSCOW, 21 Dec. World oil prices fall on Monday, nearing lows of 2004 due to renewed investor concerns over an overabundance of raw materials on the global oil market, according to AFP.

As 07.26 GMT the price of February futures for North sea petroleum mix of mark Brent fell by 0.86% to 36,34 dollars per barrel, approaching the lowest level since July 2004 36.2 per barrel. The price of January futures for WTI decreased by 0.73% to 35,8 per barrel.

Analysts argue that the concerns of traders caused by the stronger dollar after the fed decision the U.S. for the first time since 2006 to raise the interest rate, and messages of the American oil service company Baker Hughes on the dynamics of drilling rigs for the week ended December 18.

According to Baker Hughes, the rig count in the USA by the end of the working week has not changed and amounted to 709 units. In annual terms, this figure dropped to 1166 units, or 62.1 per cent. The number of oil rigs increased by 17 units, or 3,24%, to 541 pieces. The number of gas rigs decreased by 17 units, or 9.1%, and amounted to 168 units.

“The number of oil rigs in the U.S. rose this week to 17 units, putting an end to four consecutive weeks of reduction”, — quotes Reuters the words of the experts of Goldman Sachs.

“The increase in the number of drilling rigs even amid low oil prices means that shale oil producers strive to maintain production levels,” said analysts at ANZ Bank.