After October, which was catastrophic by any measure of oil prices, which lost about 20% of its value, this time it is the turn the US sanctions on Iran, which instead of raising the price of crude as it was expected by everyone, the result was reversed and the price of crude is under $ 70 a barrel at the end of the weekly trading on Friday evening.
Immediately after the US sanctions on Iran entered into force on Monday, November 4, the oil prices reacted inversely to $ 72 a barrel, but over the course of the week ended it was around $ 70 below, reaching $ 69 for Brent North Sea crude.
This new fall in crude prices on the international market is added to its frightening fall of last October, which was classified as a black month because the oil price lost about 20% of its value after hitting its highest level in four years, when it exceeded $ 86 a barrel on last October 3.
In the context, the former Minister and General Manager of Sonatrach, Abdelmadjid Attar, said that the decline in oil prices after the application of US sanctions was expected, and shows again that the market is not controlled by OPEC, but is controlled by consumers and other factors.
In a statement to Echorouk, Attar added that the United States is also pressurizing OPEC prices through production and exerting pressure on the market indirectly.
He explained that Washington authorized eight countries, including China, India, Turkey and Italy, to continue buying Iranian crude because they know that the loss of Iranian production from the market will raise prices above $ 90 a barrel and there will be scarcity in the market.
“America is not helped by the rise in the price of oil above $ 90, its partners and the rest of the consumers are not helped either”.
“Saudi Arabia also increased its production and Russia as well to compensate for the shortage of Iranian supplies. Saudi Arabia is following orders from President Trump. This situation happened after the events of September 11, 2001 and the invasion of Iraq in 2003, where prices rise because of the increase in Saudi production”.
“There are factors that prevent the price from rising, some of which are commercial and others are non-commercial, but geopolitical” he said.
Attar predicted that the price of oil will stabilize in the coming days and weeks at these levels and will not decline much, because in the end there is a kind of balance in the market.
Attar concluded by saying that prices will remain at these levels (around $ 70 a barrel), until the meeting of the Organization of Petroleum Exporting Countries OPEC in Vienna, Austria by next December.