OPEC and the vast number of friends that it has are all concerned about the rising race to supply the planet with volumes of oil in 2019 and beyond. The oversupply of crude oil is now becoming reality while many producers are sitting around waiting for the approval to pump more – and they wait and wait. But with the US producing more and more and taking market share in the process, the committee that runs the oil group says that they may cut more volume to trigger another price rally – some are now scratching their heads in disbelief. This is because they actually want to sell more product to meet budget needs. All confusing but in the end, we know the result will be the same – oil prices go much lower. The group started capping output of this black gold since January 2017, but fears of a global economic slowdown combined with demand destructing have cased prices to fall in the past month – oil prices will continue lower in our view. Will will be updating along the way.
The oil market looks poised to move into oversupply in the coming weeks and months whie the US ramps up production to 11.6 million barrels per day currently to 12.1 million barrels expected in 2019 (B/D). Not only does the increase make the US the number one oil producer, ahead of Russia and Saudi Arabia, but the rate of increase is shockingly fast. This means that the US will continue to take market share from Iran and other state sponsors of terror in the future. And while the US hits new production records, Russia and Saudi Arabia are also taking market share with the three oil super powers accounting for 40 percent of global production.
Crude oil prices are set to fall, and fall more.