Oil prices are down once again, and Wall Street followed with a lower opening during Friday morning session. The recent oil price rally of several month is no longer happening for the time being, as the price fell to $48 a barrel after recent highs of about $51 a barrel.
For a long time one of the reasons for the hold of the oil price at about the $50 a barrel was the Saudi Energy Minister Khalid al-Falih, who said in several statements that the kingdom will discuss with other oil producers a possibility for a more coordinated supply system. This optimism worked, as investors did not abandon the commodity despite occasional increases in production.
It is no longer working. Just last week the Saudis reported they reached new records of production, with nearly 10.7 million barrels per day in July. In addition Reuters reported that industry sources claim that the Saudis are only increasing production this month.
The oversupply is not over, and concerns might reappear once again.