During 2019, the price of oil did not exceed $70 per barrel. Despite the
adversities presented worldwide during 2019, occasionally affecting the
expectations of investors in the course of oil prices e.g. attacks in Saudi
Arabia, sanctions against two members of OPEC (the Venezuela and Iran),
drastically limiting the production of large oil-producing countries οil prices were not stabilised at a
higher price level.
For 2020, a reduction in demand for oil internationally is projected due to increased intensity for a change in societies towards greater use of green energy due to strong social pressure to protect the environment. In 2019 the crude oil-New York showed a total rise of 35%. The oil-type Brent for the same year scored a corresponding rise of 26%.
The fact that the price of oil did not surpass a specific threshold level
is because any reduction in oil production was covered by the increased US oil
production that covered demand in specific difficult time periods. For 2020 it
is expected that the US will intensify its daily oil production in order to
surpass a mean of 13.5million barrels per day compared to 12.5millions barrels
per day oil production that was achieved in 2019.
This event is due to the ever-increasing production of shale oil that drastically increases the total US oil production. Shale oil is a non-conventional oil produced from fragments of shale oil with pyrolysis, hydrogenases or thermal dissolution.
On the other hand, if car manufacturers fail to construct low-cost
electricity storage batteries to make the total cost of electric-powered cars
almost equal to the cost of conventional and diesel-powered cars, the demand
for oil will remain stable near the levels of 2019.
The increase in oil production (crude) from countries such as Brazil and
Norway, creating many countries increasing their oil reserves thus absorbing a
part of the increased production compared to the production of 2019. This event
will create all those conditions so that on average oil prices in 2020 are to
move at a lower level compared to 2019.
Any interference and events that may affect global oil production (e.g.
Gulf War) causing an increase in its price will be short-term as the potential reduction
in oil production will be covered by the increased production and coordinated
use of stocks in the market from other countries such as the USA.
The increasing pressure on the EU to implement the recently announced
Green Deal in Europe will further increase the
withdrawal and removal of European consumers from the use of oil, turning them
towards the use of green energy by smoothing out any inflated production from
its drastic fall in demand.
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