After a constant negative trend, the oil prices showed an ascendant movement yesterday, meaning that it went up. However, this progress was not for too long. In the middle of the day the oil prices went down again. Yesterday, on 20 April, the cost of June futures of Brent rose by 1.21%, reaching 64.22 dollars per barrel. The May futures price of WTI rose by 1.49%, up to 56.57 dollars per barrel. There are 3 important events that have influenced the prices, which moderately increased for a while.
The world oil prices rose on Monday after the growing tensions in Yemen. About 100 people were killed on Sunday in southern Yemen in the fighting between Shiite rebels and the supporters of the current president Abd Rabbuh Mansour Hadi, the local media was reported. The most violent clashes took place near the town of Ad-Dali. The operation “Decisive Storm” of the Arab coalition forces that aim to eliminate the Houthis militant groups began late in the March. The UN has recently expressed concerns about the peasant civilians in Yemen due to current difficult conditions. According to humanitarian organizations, the population is in need for food, medicine and fuel. As a result of the conflict, over 150 thousand people became internally displaced.
A positive impact on the price of black gold is also due to the Friday’s data of the American oil company Baker Hughes. Thus, the number of drilling rigs in the United States fell by 34 units, which means 3.44%, or 734 units, by the end of 17 March. This indicator shows the lowest number from December 2010. In the last year this figure fell by 47.8%, which means there are almost half of the drilling rigs working at the moment, in comparison with the last year.
The third important news comes from China, where the Central Bank has stimulated the growth of oil prices. The bank cut its reserve requirement ratio by one percentage point. Thus, the Chinese banks now need to reserve 18.5% of the funds. A similar cut was not known after the financial crisis.
The oil prices would probably continue to grow, but during the day, the Saudi Oil Minister Ali Al-Naimi declared that the oil production in the Kingdom reached record levels in April – about 10 million barrels per day. This declaration, along with the strengthening dollar, that presses the black gold, returned the negative trend of the oil.