Investors' portfolios are now showing a sell-off in futures and petroleum-related crude oil even as the market faces concerns about its consumption growth in 2024.
Crude oil sales are now roughly distributed by NYMEX and ICE as much as 63 million where West Texas Intermediate amounts to 33 million and Brent 30 million.
Reports reveal a reduction in sales of oil and gas in Europe by 5 million barrels. Meanwhile, US gasoline purchases increased by 1 million barrels and there was no change in diesel demand.
In summary, almost the entire sale of crude oil was linked to the opening of 'short selling' positions which increased the market volume by 59 million barrels. The market situation continued for 10 weeks until December 12 and it was interrupted for two weeks due to repurchasing towards the end of the year.
Production increases from Brazil, Guyana and the exploitation areas of the United States are expected to be sufficient to meet consumption growth in 2024.
Oil prices edged higher after slipping in the previous session as Saudi Aramco's price cuts raised concerns about a weaker market.
Additionally, there is an expectation that Saudi Arabia and its OPEC+ partners are unwilling to cut production to sustainably raise prices in the short term.
Actions in reducing production will only give producers a competitive advantage and give up more market share.
