Oil Gains a Little Trading Close to $41with Optimistic Outlook of Drop in Output
Last month, crude oil prices have dropped to its twelve year low and gained only after speculation provided some optimistic outlook that stronger demand and sliding U. S. output will cut out some of the supply glut.
On the other hand, the OPEC members are also initiating a talk over a freeze. All member nations have been invited next month to discuss the issue in Doha next month. Though it seems all will attend but OPEC's Secretary General Abdalla El-Badri El-Badri predicted on Monday that approximately fifteen or sixteen nations will participate.
Oil traded close to $41 after OPEC said that prices are expected to rebound to a "moderate" level even if Iran does not join the other oil producers in freezing the output.
In New York May oil futures remained almost unchanged after climbing as much as 0.7 percent earlier.
The drop in oil output outside in non-OPEC oil exporting countries and a reduction in U. S. drilling reveals the strategy of OPEC is working, which allows the market rebalance itself. According to Abdalla El-Badri, it is expected that the American crude stockpiles will rise, keeping oil supplies at the maximum level since 1930.