Oil is falling - is this a new trend?
Brent crude oil prices are close to $100 per barrel. Since the peak in June, oil has already fallen by 18%.
What is going on?
The main reason for the fall of oil is the approaching global recession, which will lead to a reduction in demand for black gold.
Recession affects the strengthening of the dollar index, which has an inverse relationship to oil prices. Further strengthening of the dollar index may lead to an even greater weakening of oil prices.
The oil war between Russia and the Persian Gulf is causing oil prices to fall. Saudi Arabia, the UAE and Iran are forced to cut prices so as not to lose competition to Russia for the Asian market.
Won't oil go up again?
Not a fact at all. If Russia refuses to supply oil at marginal prices, we may see a historic fuel shortage in the world, leading to an uncontrolled growth of oil.
That said, there will still be shortages. ESG has killed the oil industry - underinvestment has resulted in OPEC being unable to increase production at a critical time. According to OPEC's latest report, fuel demand will continue to rise in 2023. And, worst of all: the increase in demand will exceed the increase in production by OPEC countries.