JAKARTA (TheInsiderStories) - The average price of Indonesian crude oil prices (ICP) fell to US$61.96 a barrel in April, decreased by $1.54 per barrel from the previous month at $63.50 a barrel, the energy and mineral resources (EMR) ministry reported.
The Indonesian Oil Price Team said that the decline in oil prices was triggered by the International Energy Agency report that world oil production increased 1.7 million barrels per day (bpd) to 92.9 million barrels bpd. Organization Petroleum Exporter Countries and its allies (OPEC) also increased by 1.2 million bpd to 93.2 million bpd.
Another factor that puts pressure on world oil prices, said the team, is the potential an increase production from OPEC+ by 350,000 bpd starting this month, 350,000 bpd in June, and 441,000 bpd in July 2021. The Saudi Arabia plans to remove the additional policy of cutting production that was previously voluntarily carried out by 1 million barrels per day also give impact to oil market.
“The OPEC+ compliance rate with the production cut quotas fell to 111 percent in March compared to 113.5 percent in February and the statement by the President of Iran, Rouhani, that the United States - Iran agreement talks have reached 60 - 70 percent,” said the team .
They rated, these things lead to the potential for increased production from Iran following the removal of sanctions related to nuclear activity. Iranian production in March 2021 has reached 2.3 million bpd, the highest point after experienced the lowest production in the last 33 years since August 2020, 1.95 million bpd.
While, Iranian crude oil exports in March to China are estimated to increase by 406,000 bpd to 896,000 bpd compared to the previous month. In addition, said the report, The decline in oil prices was also influenced by negative sentiment regarding the potential for a slowdown in the delivery of the COVID-19 vaccine, particularly in relation to the restrictions on the AstraZeneca in the European Union and the Jhonson & Johnson Vaccine in the United States.
“Based on the publication of the Energy Information Administration, the gasoline stocks at the end of April increased by 4.6 million barrels to 235.1 million barrels compared to stocks at the end of March,” added the team.
As for the Asia Pacific region, the decline in crude oil prices was also influenced by the increase in COVID-19 cases in India, Japan, Thailand and the Philippines, which led to further lockdowns, especially in the main regions of India and Japan. In addition, the potential decline in Chinese demand in second quarter of 2021 as refineries enter a maintenance period.
The negative sentiment also come on the slowing Chinese growth after the announcement of the PMI for manufacturing and non-manufacturing by the statistics bureau, fell by 0.8 and 1.4 in April to 51.1 and 54.9 compared to the previous month, respectively.
Written by Editorial Staff, Email: theinsiderstories@gmail.com
