Sberbank CIB analysts have warned about the risk of oversupply of oil


The probability of oversupply of oil on the world market remains, this is indicated by global data mining, said in an analytical review of Sberbank CIB. Since the beginning of summer, the number of drilling rigs in the US increased by six units, and the total number increased to 40. In the end of June, when commodity prices reached a local maximum, oil prices dropped 10%, says the survey.

Oil continued to fall on Monday, July 18. According to ICE, the price of Brent crude in 17:10 GMT $against 46.63 per barrel, which is 2% below the previous closing.

In the review of Sberbank CIB said that the oil-producing U.S. companies are actively hedged against falling oil prices, as well as attract equity capital for payment of a debt or the purchase of new deposits, increasing the demand. According to Bloomberg, since January the company has raised more than $16 billion of equity capital.

The growth potential of oil prices is limited, but possible in the case of interest for risk from global investors, analysts of Sberbank CIB. The price could rise to $50 per barrel if a long time has been stopped its supplies from Russia and Iraq through the Bosporus due to the attempted coup d’état in Turkey. On Saturday, the Turkish authorities closed the Bosporus for the passage of tankers, for safety reasons, for fear of terrorist attacks. However, Sunday deliveries were resumed.

Optimal for Russia price of oil is currently the price is about $40 a barrel, shown by the Bloomberg survey of experts, the results of which became known on 18 July. This price, as noted in the article, is low enough to make the inevitable institutional reforms of the economy, and at the same time high enough to prevent a collapse of the financial market.

More than half surveyed by Bloomberg experts believe that the price of a barrel of Brent to $40, on the one hand, will force the Russian authorities to reform, and with another — will allow to start without the risk of falling into a new crisis. About 30% of respondents consider that the critical level price of $30 per barrel and that the reform will start at a price above $50, I believe only about 5%.