But in October, forecasters warned that oil demand would grow more slowly than previously thought. In the same month, the stock market collapsed, shattered by a sell-off in high-flying technology stocks, the ongoing US-China trade dispute, and rising interest rates.
Investors began dumping risk-weighted assets, and by the end of the month, the oil price had fallen by around $ 11 a barrel from the October 3 high. Momentum trading and the rotation of falling crude oil futures and rising natural gas contracts also compounded oil losses, analysts said.
The situation worsened when sanctions on Iran officially broke Iran on November 5. President Donald Trump surprised the market by granting generous exceptions to the largest buyers in the Islamic Republic. This meant that Saudi Arabia, Russia and several other manufacturers had brought production into a market where demand growth was slowing and Iranian barrels lost less than expected.
At the end of the year, the US-China trade dispute remains unresolved and continues to worry that a full-blown trade war between the world's two largest economies will reduce fuel demand. Meanwhile, US crude oil production is growing faster than expected, with the US leading Saudi Arabia and Russia to become the world's largest producer in the second half of 201
However, many US manufacturers need oil prices of $ 50- $ 55. The cost of new wells may even be the same, forcing some energy companies to take the breaks, said Neal Dingmann, an oil-savings analyst with Suntrust Robinson Humphrey ,