The revenues of OPEC countries from oil exports past year declined by 13.2% to $445,68 billion, despite the fact that the physical volume of foreign supplies of the countries of the cartel increased by 6.5% to 25,014 million barrels. a day.
As if a mini-collapse in oil prices wasn't bad enough for OPEC, the pattern in which futures contracts are trading years from now has flipped into the worst possible structure for the exporter group. In the third development stage, Libya plans its production to increase to 2.2 million bpd by 2023, which would require around US$18 billion in investments. The traders are stating that the constant oil production in the U.S.is undermining the OPEC efforts to stabilize the market.
Brent for March settlement dropped 26 cents to $55.23 a barrel on the London-based ICE Futures Europe exchange, closing at a $2.48 premium to WTI.
So far, the production-cut agreement has had little impact on global inventory levels due to rising supply from producers not participating in the accord, such as Libya and Nigeria, and a relentless increase in US shale oil output. However, at that time, the price of Crude Oil barely stayed above $50.
United States drillers increased the total oil and gas rig count by 35 to 694 in the week ended January 20, according to data from Baker Hughes.
Despite the slight tick higher Monday, investors remain focused on the prospect of yet more oil supply.
"The U.S. oil rig count continued to rise, up by 6 last week", Goldman Sachs said late on Friday.
"These are all signs of an oversupplied market".
Crude oil pricing gets even more complicated when supply and demand factors are taken into consideration worldwide.
The return of West African and Libyan crude "could be a reason for the build in the North Sea", said Jorge Antequera, a crude oil market analyst at Kpler. Forcados exports are now expected to average about 285,000 barrels a day in August, nearly a quarter of the volume that OPEC has pledged to cut from the market.
Despite the agreement, the oil price suffered a major selloff on that day and was down around 3 percent by the end of the day.
Generally, supply and demand have been the most important considerations.
"The decline in revenue was expected, because in 2015 the average price of a barrel of Brent crude was at $52,4, and in 2016 - $44,1", - says the analyst of Raiffeisenbank Andrey Polischuk. Demand grew mostly at the expense of the Asia-Pacific region (primarily China and India).
Talking about the future of oil, many economists have pointed out that in the next 10 years, oil-producing countries will face more economic problems if they do not expand their investments and diversify their sources of income. It is insane to expect an imaginary rise, such as a price of $120 a barrel or more in view of the tense global conditions.