Oil Prices Recovering

Oil Prices Recovering

Barrels close to $50 per

The market may see some improvements with oil prices beginning to stabilize.

Oil prices have reached nearly $50 a barrel at $48 and change this am. The price is a 7 month high, and is nearly 50 percent higher than February marks.

The reasons behind this change are multiple and include natural disasters, militants, and even the zika virus playing a part.

The market was being flooded with oil from so many competitors that oil prices were plummeting. Goldman Sachs believes this is no longer the case due to high demands from China, India, and Russia...along with some high producing oil machines who have had to cut production.

Beginning with Canada, wildfires have caused the production of oil in the area to be reduced nearly 75 percent. The natural disaster of fire destruction in the area has considerably impacted the region and therefore oil production. 

Another high producer of oil is Africa, but many armed militants have been going directly after oil producers. Many facilities have been taken over, and they too have seen significant drops in production...which in tern have affected prices.

The zika virus has been plaguing parts of Venezuela, along with medical and food shortages in the area. These issues too, have caused limited oil production in the highly productive oil manufacturing business there.

The culmination of all of these shortages, or loss in production, in these areas...coupled with higher demands have together helped even out the oil industry. The oil dumped into the market is now maneagable...but how long will it last?

As usual these barrel numbers will be very up and down, but the latest surge was something not seen in decades. It will be important to keep your eye on this issue as we see these fluctuations often around this time as well, and the issues contributing to production loss are time-limited

 

Picture:

https://www.flickr.com/photos/magnera/3755006104/in/photolist-6HPouy-65a...