By Osama Jalal
KUWAIT, March 11 (KUNA) -- Rise of the US dollar to levels unprecedented since August 2003, over the past two days, constitutes the main cause for the fall of oil prices, according to a Kuwaiti petroleum expert.
Mohammad Al-Shatti, interviewed by Kuwait News Agency (KUNA), affirmed that the oil prices' decrease is due to the green-back bullish trend, for the dollar is the currency for trades in oil and other products worldwide.
Average rate of the Brent crude, in Q1 of 2015, reached USD 55 per barrel, while that of the exported Kuwaiti crude, USD 55 pb. Such levels affirmed improvement of the oil prices between January and March 2015.
Some market factors, namely prevailing cold in much of the hemisphere and high demand, have recently pushed the crude prices up by some USD 10, Al-Shatti said, adding that 20 percent of refining capacity is paralyzed in some high-demand nations due to cold and labor activities such as strikes, thus negatively affecting heating oil sales, particularly in European markets.
Al-Shatti also indicated at decline of the Shale oil output, also indicating that non-OPEC's oil supplies dropped from 1.6 million barrels per day in 2014 to 600,000 bpd this year.
Al-Shatti forecast hike of the oil prices, in the coming months, due to supplies shortage. But regarding decline of the crude prices over the past two days, he said they fell due to new data about unemployment in the US and the USD restoration of its strength vis a vis the other major currencies.
Other factors that have contributed to pushing the prices down are continuing the rise of the crude reserves in the US and jitters resulting from outcome of the Greek debts' issue.
Predictions, in general, show low prices between April and June, 2015, Al-Shatti said, anticipating that the oil prices would be in the range of USD 40-45 pb, in the foreseeable future. The main cause is slump of seasonal demand, he said, noting that key refineries in the East and Europe would undergo maintenance.
However, the oil prices in the year's Q2 will recover and will reach USD 55-60 pb, Al-Shatti said, predicting demand increase.
Oil market, in the coming years, is expected to be distinguished with prevailing glut, he said, due to various factors such as consumption rationing and development of alternative energy resources. (end) osj.rk