US, WASHINGTON (ORDO NEWS) — Oil prices have dropped to their lowest level since 2003, as the planned OPEC-US deal failed to materialize.
Monday morning, the price of futures on international Brent fell 5.8% to $ 25.42 at 9:35 am, while the price of WTI oil futures fell 1.2% to $ 22.35.
OPEC Secretary General Mohammad Barkindo invited Texas Railways Commissioner Ryan Sitton to the organization’s summer meeting in June on Friday. Although this invitation quickly raised hopes for an agreement to stabilize oil prices, Sitton drew criticism by calling for a reduction in Texas crude production for the first time since 1970.
Neither Saudi Arabia nor Russia back down on their price war policies, Kremlin observers having said that Russian President Vladimir Putin would probably not give in to what he perceived as Saudi oil blackmail.
The increased supply that the two countries insist on may soon drive prices even lower, as the constant spread of the COVID-19 pandemic continues to depress demand.
Frank Macchiarola, senior vice president of the American Petroleum Institute, told Bloomberg: “It seems totally irrational that the solution to the disruptive behavior of Saudi Arabia and Russia is to emulate OPEC.”
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