U.S. and Arab energy giants reach $60 billion partnership
author: Ann
2025-05-30
Impact on energy prices: Balance in fluctuations
In the short term, the news of this series of cooperation projects will have a direct impact on energy prices and cause market sentiment fluctuations. In the oil market, when the market learned that the Upper Zakum oil field would increase its production capacity, investors' expectations for future oil supply increases increased, which may lead to a short-term decline in oil futures prices. For example, in 2016, after Saudi Arabia and other oil-producing countries announced plans to increase production, international crude oil futures prices fell sharply in the short term, and Brent crude oil prices once fell below US$30 per barrel.
The same is true for the natural gas market. The news of the expansion of the Shah gas field's production capacity will affect natural gas futures and spot prices. The European natural gas benchmark price - the Dutch TTF natural gas futures price, may fluctuate due to expectations of increased LNG exports from the UAE. If the market believes that natural gas supply will increase significantly in the future, prices may face downward pressure. But at the same time, natural gas prices are also affected by seasonal factors, geopolitics and other factors. In the winter heating season, Europe, Asia and other places have strong demand for natural gas. Even if there are new supply expectations, prices may remain relatively stable or even rebound due to demand rigidity.
In the long run, energy prices will return to a track dominated by the global supply and demand balance. As the production capacity of the Upper Zakum oil field and the Shah gas field is gradually released, the global supply of oil and natural gas will increase. If the global economy maintains stable growth, energy demand will rise simultaneously, and the growth rate of demand matches the increase in supply, then energy prices are expected to remain relatively stable.
In the short term, the news of this series of cooperation projects will have a direct impact on energy prices and cause market sentiment fluctuations. In the oil market, when the market learned that the Upper Zakum oil field would increase its production capacity, investors' expectations for future oil supply increases increased, which may lead to a short-term decline in oil futures prices. For example, in 2016, after Saudi Arabia and other oil-producing countries announced plans to increase production, international crude oil futures prices fell sharply in the short term, and Brent crude oil prices once fell below US$30 per barrel.
The same is true for the natural gas market. The news of the expansion of the Shah gas field's production capacity will affect natural gas futures and spot prices. The European natural gas benchmark price - the Dutch TTF natural gas futures price, may fluctuate due to expectations of increased LNG exports from the UAE. If the market believes that natural gas supply will increase significantly in the future, prices may face downward pressure. But at the same time, natural gas prices are also affected by seasonal factors, geopolitics and other factors. In the winter heating season, Europe, Asia and other places have strong demand for natural gas. Even if there are new supply expectations, prices may remain relatively stable or even rebound due to demand rigidity.
In the long run, energy prices will return to a track dominated by the global supply and demand balance. As the production capacity of the Upper Zakum oil field and the Shah gas field is gradually released, the global supply of oil and natural gas will increase. If the global economy maintains stable growth, energy demand will rise simultaneously, and the growth rate of demand matches the increase in supply, then energy prices are expected to remain relatively stable.
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ما هي الزيوت الصناعية وكيفية استخدامها؟
