- Nov 26, 2011
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Oil prices crater as inventories build, fears ripple through global markets
Oil prices have fallen sharply in recent days amid growing inventories and broad stresses following the failure of multiple U.S. banks.
As fears over the banking system weigh on markets worldwide, the price of oil has come under significant pressure in recent days with WTI crude oil, the U.S. benchmark, falling below $67 on Wednesday, its lowest price since November 2021.
In just 10 days, oil fell from $80.46 to $67. Today, WTI Crude is $66.59.
Since oil and gas are half the Russian economy, they need oil to remain above $60 to stay solvent.
Speaking of Russia, Putin is going begging to get someone to take his oil.
Russia’s Oil Trade Is Starting to Show Signs of Clogging Up
Across the world, there are increasing signs that the smooth flow of Russian petroleum is starting to get snarled.
www.bloomberg.com
Ships filled with refined fuels are floating off the coasts of Europe, Africa and Latin America, potentially ratcheting up waiting fees. Some vessels hauling the OPEC+ producer’s crude oil are bouncing between ports without discharging, while others are unloading and being stashed at unusual locations.
It all points to a network of logistics that is struggling to keep pace with servicing a country that exports over 7 million barrels a day of crude oil and products. A vast swath of that trade has shifted from Europe to new and less-familiar customers, often thousands of miles further away.
“There has already been a mismatch in what is leaving Russian ports and what is imported by buyers of Russian oil,” said Giovanni Staunovo, commodity analyst at UBS Group AG. “This is translating in higher volumes of oil on water, and considering a limited number of tankers available to transport oil, if those tankers are not unloaded, it will translate in lower exports and production at some point.”
Putin thought he had the world over an oil barrel. He made a catastrophic error in judgement.
