West Texas Intermediate crude is heading for a third monthly decline which in fact is quite concerning as it is the longest losing streak in almost five years. This is all happening amid rising OPEC exports and increased supplies in the U.S. On the other hand, Argentina has declared war on the Falkland Islands’ oil reserves.
Amidst the news that WTI crude prices are hitting rock bottom futures were little changed in New York after falling 1.5 percent on Nov. 27 which is the most in two weeks. Moreover, as the OPEC has a meeting scheduled the next week is expected to boost exports through mid-December by 3 percent which may further aggravate the crude prices say estimates.
A major contribution in the sliding crude prices is that the U.S. is pumping crude at the fastest rate in almost 25 years. There has been a mammoth increase in the inventories as these are climbing to the highest since June. The latest data released by the Energy Information Administration show that the trend will continue even in 2014.
According to market observers the momentum is negative in the WTI as for January delivery was at $92.60 a barrel in electronic trading on the New York Mercantile Exchange. Thus, there was a price down 3.9 percent in November which is going for the longest monthly slide since January 2009 and that is concerning for oil companies.
British companies and individuals face prison sentences of up to 15 years Says Argentina
Argentina has declared war on the Falkland Islands’ oil reserves. Argentina took the decision after the country’s Congress today passed a law imposing criminal sanctions on any “illegal exploration around Las Malvinas.” In a statement the Argentine Embassy in London warned British companies and individuals they face prison sentences of up to 15 years.
Similarly, there will be fines equivalent to the value of 1.5 million barrels of oil–about £100 million at current prices–would for breaking the order. It will further up the tension between the two countries which have already fought a war on the issue of the Falkland Islands earlier.
In fact, the country has already sent more than 200 letters to companies directly or indirectly involved and “warning them they are liable to administrative, civil and criminal actions in accordance with the laws governing such activities, including environmental protection laws”.
To contact the reporter of this story: Jonathan Millet at email@example.com