With oil prices struggling to hold above $50/B and market fundamentals suggesting little change in the status quo for at least another six to nine months, Venezuelan President Nicolas Maduro is again stepping up efforts to muster support for initiatives aimed at “stabilizing” oil prices. And, rest assured, he’s not looking for stability at $45/B.
Oil prices collapsed over the six months to January. Since then they have been volatile: Brent rose to average $65/B for May and June, before again tanking to hit a new five-year low of $42/B at the end of August. While the oil price fall had its genesis in record-breaking rises in US output and weak global demand, big gains in Opec output, particularly since the turn of the year, has only put further downward pressure on the oil price (see graph). (CONTINUED - 2125 WORDS)
