Jakarta (Indonesia Window) – According to the calculation of the Indonesian Crude Price (ICP) formula, the average ICP in November 2019 rose by US$3.44 per barrel, or from US$59.82 to US$63.26 per barrel.
That price follows an agreement in the first stage of trade talks between the United States and China, boosting optimism in the world oil market.
“In November 2019, the world oil market rose due to several factors such as the US-China agreement and the delay of Brexit deal by the European Union until January 2020. This is a positive signal for the world oil market,” spokesperson of the Indonesian Ministry of Energy and Mineral Resources Agung Pribadi said here on Friday.
Meanwhile, the Indonesian Oil Price Team said the increase in Indonesia’s oil prices was also due to market expectations when the OPEC+ countries extended the period of production cuts or even increased the amount of production cuts at the meeting on December 5, 2019.
The Indonesian Oil Price Team Note shows that the average prices of major crude oil in the international market in November 2019 has increased compared to those in October 2019.
For example, Dated Brent crude oil increased by US$3.30 per barrel from US$59.72 to US$63.02 per barrel.
The International Energy Agency (IEA) report in November 2019 indicated that the global crude oil demand would increase in the fourth quarter of 2019, by 300,000 barrels per day compared to that in the third quarter of 2019 due to growth in demand for crude oil in OECD (the Organization for Economic Cooperation and Development) countries.
In addition, the decline in Iran’s oil production to 2.15 million barrels per day, which is the lowest production since 1988, due to the sanction imposed by the U.S also influences the crude oil prices spike.
In Asia and the Pacific, the crude oil prices spike is also influenced by the increase in refinery processing along with the operation of several new refineries in China; the end of the petrochemical refinery maintenance period in South Korea; and the increase in oil throughput of some refineries in such Asian countries as Taiwan and Japan.
Reporting by Indonesia Window