MP explains in which case the price of oil can rise


April 2, Fineko/abc.az. Current oil prices are very low, and the U.S. is negotiating to change that and achieve a repeat increase in prices in the oil market.

The relevant statement was made by MP Vugar Bayramov, when replying the question from ABC.AZ about the causes of the decline in oil prices.

The MP noted that the existing price is not in interests of the U.S., including oil producers, and this leads to oil production cuts in the U.S. and to the reduction of its share in the global market: "From this angle the change of oil price depends directly on whether the agreement reached between Saudi Arabia and Russia. The return to the OPEC+ format may lead to a repeat increase in oil prices.

Given that today the oil market observes a decrease in demand by about 10 million bpd due to the impact of coronavirus and there is an abundance of oil on the market, it is natural that this directly affects prices. In this regard, an increase in oil prices may be observed if the OPEC+ format is restored due to a decrease in production. US President Donald Trump is already conducting certain diplomatic negotiations in this direction with both the owners of a number of oil companies and the government of Saudi Arabia. Naturally, if this is realized, we may see a certain increase in oil prices again as a result. But if the parties do not reach an agreement, the price of oil may fall to $15.

Currently, oil prices on the world market fluctuate between 20-25 dollars.

By Elmir Murad