Russia's oil production plummeted and international oil prices rose

The International Energy Agency (IEA) said that oil prices may rise next year as western countries' sanctions squeeze Russia's oil supply and market demand may exceeds previous expectations.

IEA said in the monthly oil market report that Russia's oil production is expected to plummet by 14% at the end of the first quarter of next year, from about 11.2 million barrels per day at present to 9.6 million barrels per day. At that time, if this prediction is true, it may reverse the recent weakening trend of crude oil futures prices.

Since June this year, the US and Brent oil have almost declined for consecutive months, and only recovered slightly in October. As of press release, the US WTI crude oil futures reported US $76 per barrel, reaching a peak of US $130 within the year, which was close to halving; Brent crude oil futures reported $81 per barrel, which also reached $134 during the year.

The agency saw in mid November that the European economy in the energy crisis was better than expected, and the major economies in Asia showed unexpected resilience. These factors are boosting the demand for oil. For 2023, IEA expects the total global demand to be 101.6 million barrels per day, 300000 barrels more than its forecast last month.

On the supply side, the IEA found that Russia's oil exports continued to expand before the ban came into effect, and climbed to 7.1 million barrels per day in November, the highest level in nearly seven months. At the same time, although OPEC+decided to reduce its output by 2 million barrels per day, it actually achieved only a quarter of the reduction target, that is, about 500000 barrels per day.

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