Texas oil value down nearly 11% in 2023

NY. Texas oil prices fell nearly 11% in 2023, the first negative year since the 2020 COVID-19 pandemic, Subject to volatile factors, but above all, to the doubt that demand can absorb uncontrolled production.

Texas closed this Friday at $71.65 without reaching $100, which some analysts had predicted, However it reached a peak of $95 in late September due to fears of too little supply as a result of production cuts in Saudi Arabia and Russia.

Dynamic factors for the year include cuts by large OPEC+ producers, which have added upward pressure, but also record production from countries outside the cartel, such as Brazil, Guyana and the US, which have flooded the market.

Last week alone, the US produced about 13 million barrels per day, and accounted for most of the increase in output among the group of non-OPEC countries, leading to a shift in supply quotas previously dominated by the Middle East. ,

OPEC committed in November to cut black gold production by 2.2 million barrels per day through the first quarter of 2024, but some analysts are not confident its policy will balance the market.

According to the International Energy Agency (IEA), It is expected that in the event of a halving of demand in 2024, there will be a significant increase in oil supply, especially in the United States.

Geopolitical factors have also influenced the price: Following the attacks carried out by the armed wing of the Islamist group Hamas against Israel on October 7, Texas had a short-term rise, but fell by about 21% in the last quarter of the year. Is. In parallel to the Israeli attack against Palestinian territories which is still ongoing.

“Investors have begun to focus on the risks of oversupply and underdemand in oil markets next year,” XM analyst Marios Hadjikyriakos said in a note today.

The Federal Reserve’s measures to control inflation, which seems to be getting closer to its 2% target in the US, have had an impact on the value of the dollar and, therefore, on the crude oil market as well, so there should be a panorama in the coming weeks. Could change.

“The market anticipates so many rate cuts could boost the global economy and, by extension, demand next year,” Oanda analyst Craig Erlam commented in a recent note.