Global oil market recovering, prices rising
The global oil market is recovering and oil prices are rising. For the first time since March, the benchmark Brent crude oil is trading at more than US$71 per barrel. Experts say that this is how the market reacted to the decision of the OPEC+ joint ministerial monitoring committee. The meeting participants agreed to maintain the previous parameters of the deal, while increasing production in July. The cartel expects that the global oil demand will return to the pre-pandemic level by the end of the year. Forecasts suggest that this could happen due to the growth of the world’s leading economies, the US and China, the onset of the summer holiday season in Europe, and declining commercial oil reserves in many countries. However, Kazakh analysts believe that the price of US$70 a barrel is excessive and will not last long. But even short-term price increases will benefit Kazakhstan’s economy. An increase in the barrel value of even US$1 could turn into revenues of about US$1.5 million, experts say.
“Compared to the pre-pandemic indicators, we certainly have not recovered yet. But thanks to Kazakh Ministry of Energy and the country’s government, we were able to maintain good positions in OPEC+. Russia and Kazakhstan were allowed to increase production. Every dollar from every barrel is a bonus to our economy, to our jobs. When we get back to pre-crisis levels, perhaps next year, I think we will fully recover. As long as this agreement binds all members, we cannot increase production to the level we would like. And plus the price factor. When the prices of US$60-US$70 per barrel hold up long enough for the rest of the year, of course, oil investors will invest,” said Olzhas Baidildinov, oil and gas industry expert.
Translation by Assem Zhanmukhanova
Editing by Galiya Khassenkhanova