Iran bitumen 80/100 price
In this article, we will look through those pieces of news, which have a large impact on the Iran bitumen 80/100 price fluctuations.
Respectively, Saudi Arabia’s decision to cut one million barrels of oil from its
daily output was shocking to the world. While everyone was confident that another price war would break out between Russia and Saudi Arabia,
Saudi Arabia made a decision that some believed would be the country’s trump card in the future. According to the Oil Energy Group,
Saudi Arabia has announced that it is ready to reduce its daily production,
while they set other members of the OPEC Plus oil bloc to
increase their production from next week.
Therefore, we can say that Riyadh alone is responsible for balancing
supply and demand in the oil market. We also should not forget that some even believe that
Saudi Arabia’s decision could mean sending a gift to Russia
and even Iran to gain more foothold in the oil market.
Why is Saudi Arabia benefiting from reduced oil production?
If we look at Saudi Arabia’s decision from the point of view that
reducing one million barrels of oil from its daily production could lead to a
rapid decline in Saudi oil revenues, then this decision cannot be reasonable
and defensible. Moreover, in all the months that Saudi Arabia has been at loggerheads with Russia over how to market its oil,
it has sought the best policy to stabilize and increase its oil revenues. However, if we put aside this appearance,
it seems that Riyadh can hope to increase its oil revenues in the future by temporarily sacrificing part of its share of the oil market. In fact, the equation
on which Saudi Arabia has decided is a simple and old equation:
if the country increased its production like the other members of the
OPEC Plus oil bloc, its share of the oil market would expand.
Saudi Arabia & the Iran bitumen 80/100 price
This expansion of market share had a significant impact on prices
and undoubtedly led to lower oil prices in February and the following months. But now, with declining oil supplies,
Saudi Arabia is hoping that rising demand for control of the coronavirus could generate more revenue. It’s worth mentioning that the cost of
Saudi Arabia’s recent decision is much faster than the benefits it will receive. In addition to the above,
the decline in Saudi Arabia’s early incomes due to declining production,
we should also note that regaining market share is usually difficult and time-consuming due to significant competitors,
but instead can bring benefits.
Iran bitumen 80/100 price & the global situations
Additionally, some analysts have conducted a study at the Oxford Institute
and said that if the demand for oil does not change much by 2024 and
Saudi policy is to increase oil production, this could increase the country’s
share of the oil market by 14%. Instead, it could push the country’s oil
revenues from $230 billion in 2019 to $92 billion in 2024, a doubling. In other words, this reduction in oil revenues could pose significant risks to Saudi Arabia. The last time Saudi oil revenues fell below $100 billion a year was in 2004;
the year that the population of Saudi Arabia was one third less than the current population of this country.
Thus, the difficulties caused by the decline in annual oil revenues in
Saudi Arabia in 2004 are not comparable to the present. This is the concern
that has led Riyadh to focus on increasing oil revenues over the next
half-decade, rather than focusing on the short-term benefits
of increasing oil supplies.
Zero Saudi oil exports to the United States will not be sustainable
In the last week of 2020, the United States did not import any
crude oil from Saudi Arabia for the first time in 35 years, but this is not a
historic moment, as it seems at first glance. In 2017, Saudi Arabia
regularly shipped over 1 million barrels per day of crude oil to the
United States across the Atlantic and Pacific Oceans, according to
Bloomberg News. As a matter of fact, in four years,
the market has almost disappeared, as the shale oil industry revolution
and subsequent falling demand following the outbreak of the
Coronavirus have changed market conditions.
Iran bitumen 80/100 price & the oil market
To be more specific, a drop in Saudi oil exports to the
United States does not mean the end of Saudi oil exports to the
United States, which will not be in the Energy Intelligence Agency’s
weekly report on Wednesday, which covers the first week of January. US customs data show that the country imported 1.9 million barrels of Saudi crude
oil in the first week of January. Generally, the decline in exports to the
world’s largest oil market is a pattern that is almost by most producers around
the world. The first oil-exporting countries to experience this decline were the United States
(except for Iran, which has not exported crude oil to the United States
since Jimmy Carter imposed sanctions in 1979).
It’s also good to know that the financial crisis of 2008 affected their
export oil shipments and then fell more sharply due to the oil revolution that began in 2011. They revived as the shale oil boom slowed in 2015,
but their recovery was short-lived. Despite the proximity of
West African producers to the United States,
it takes about three weeks for their crude oil to reach the east coast of the
United States, and it takes about six weeks for the oil to be delivered from the Middle East.
Iran bitumen 80/100 price & the demands
Respectively, West African producers suffered because their crude oil quality
was closer to that of US shale oil than its competitors, making it easier to
replace at refineries. Middle Eastern producers were initially in a better
position, despite years of distance and concern about US geopolitical developments in the region. Iraqi oil shipments boomed and reached a
15-year high in April 2018 as the country’s oil industry recovered after decades
of war, sanctions and mismanagement. Although it was a short-lived boom.
The second shale wave in the United States affected everyone. With the refurbishment of American refineries,
there was less need for imported oil to get better results from lighter,
sweeter (sulfur-free) materials. Even after the rise of the second wave of
the shale revolution in late 2019, the downward trend continued.