US Demand for Oil Continue to Rise Amid Output Cut
To curb the plummeting price of crude oil due to over production and low consumer demand, the Organization of Petroleum Exporting Countries (OPEC) cut its production by almost 1.3 million barrels per day.
On the other hand, US are demanding more crude oil as inventories have increased its orders more than 700,000 barrels every day.
To curb the continuous downfall of oil prices, the Organization of Petroleum Exporting Countries (OPEC) cut its production by almost 1.3 million barrels per day. Despite this move, the US demand for crude oil has dramatically increased by more than 700,000 barrels per day since January.
Experts warned that this incongruent development may serve as another blow for OPEC which is still reeling from the global economic slowdown that resulted to low oil demand few months ago as consumers spend less and businesses halt production.
Last year, crude oil prices plunged as consumers cut its demand for diesel fuel, gasoline, and other petroleum products. But as OPEC did not anticipate this event, the organization had over supplied the market which resulted to plummeting value of crude oil.
OPEC said that oil prices should settle at $75 or higher per barrel to cover its massive losses in the past, adding that cutting its production is the only way to stop the oil prices from plunging.
Earlier report said that Saudi Arabia, the biggest exporter of oil in the world, cut its production by more than 8 million barrels per day, almost half of its initial output. And according to experts, this is the country’s lowest output for nine years.
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