Business NewsEconomics

Oil continues to rise in price on expectations of OPEC decision

According to trading data, world oil prices continue to increase on Monday evening, while traders expect OPEC to decide to increase production no faster than previous plans.

The price of January futures for Brent crude oil rose by 1.09% to $ 84.63 per barrel, December futures for WTI rose by 0.78% to $ 84.22 per barrel.

Traders continue to expect the next OPEC meeting, which is for Thursday. Bidders estimate the likelihood that the alliance may renegotiate the terms of the agreement in light of the market situation. In July, OPEC countries decided to increase oil production by 400 thousand barrels every month, starting from August.

“It seems that the alliance will try to resist taking tougher measures and will stick to increasing production by 400 thousand barrels per day monthly,” the Wall Street Journal newspaper quoted ING analyst Warren Patterson as saying.

The general tendency of global traders to optimism also supports the growth of oil prices. European stock exchanges increased 1% on Monday, and the main US stock indexes updated historical records. The Dow Jones Industrial Index (DJIA) rose above 36 thousand points for the first time.

The observed autumn rally in the global oil market has slowed down. Although the price of a “barrel” of Brent during trading on October 26 exceeded the mark of $ 86. However, a correction followed in subsequent sessions, and on some days of the third decade of last month, recorded patterns below $84 per barrel.

So far, oil prices are comfortable for world exporters of “black gold.” But the “covid risks” have increased in recent weeks, which has given a break to the market. As a result, the speculators’ goal of $90 for a barrel before the end of autumn is no longer as evident as it seemed back in October. The Green front is also pressing: a two-week climate summit has started in Glasgow.

The market reporter that Saudi Arabia called on its oil-producing allies to present a united front at the upcoming climate talks against reducing investments in fossil fuels to avoid price increases.

The authorities of the Kingdom and several OPEC states claim that any calls to reduce investments in the development of new oil and natural gas fields were approved at the UN climate summit.

which started on October 31 in Scotland, “could lead to higher prices and an increase in the gap between rich and poor countries.”

Last week, Russian Deputy Prime Minister Alexander Novak held several constructive meetings with representatives of Saudi Arabia during a working visit to Riyadh.

These bilateral rounds are an essential part of the OPEC alliance’s strategy to protect oil markets from the upcoming consolidated “attack on hydrocarbons from Glasgow” by a large pool of obsessive supporters of radical decarbonization.

Putin and Jinping, who objectively and cautiously assess the “green agenda,” did not arrive at the climate summit – the leaders of the Russian Federation and China preferred, for several reasons, a remote format of participation.

The probability of OPEC deviation from the strategy is unlikely. On the contrary, due to the November session, the alliance will most likely prefer to act on previously agreed plans since there are no motives for an operational revision of the mining regime yet.

TheMarketReporter

TheMarketReporter was founded to provide mission-critical intelligence for hundreds of selected companies. We not only gather, but we also validate and route what today’s decision-makers require to assess this evolving and complete industry. With unparalleled insight, we are able to offer you the connections, context, and relationship that will help drive innovation and allow you to unlock unique market opportunities.
Back to top button