Crude oil prices began the week of August 7th at USD 49.39 and ended it at USD 48.82, which represents a weekly decline of 1.2%.
U.S. Crude Oil Inventories decreased by 6.4 million barrels over the previous week, well above analysts’ consensus of 2.2 million barrels. The Baker Hughes Rig Count dropped by 5 to 949, which remains high compared with previous years.
After an OPEC meeting in which cartel members reaffirmed their commitment to output cuts, crude oil came close to the USD 50-mark toward market close on Wednesday. However, further to escalating tensions between North Korea and the United States, crude oil prices experienced huge losses in trading on Thursday, as investors sought out gold, government bonds, the yen and the U.S. dollar as safe havens. Moreover, the revelation that OPEC members had increased their production in July continues to call into doubt the effectiveness of the agreement signed in Vienna.
Friday, the IEA declared that the lack of commitment from certain countries (particularly Iraq and the United Arab Emirates) was one of the main causes of the extended imbalance between supply and demand. It remains to be seen whether the countries will keep their recent promises.