Oil up despite OPEC + decisions

LAST UPDATE 18:00

Oil is on the rise as markets appear to doubt whether the extra output decided by OPEC + yesterday could offset supply from Russia and meet growing demand from China amid easing restrictions on the coronavirus.

In particular, the American WTI trades with profits 1.3% or $ 1.5 and sees its price rise to $ 118.4 the barrel.

Similarly, the Brent raises $ 1.35 or 1.15% and moves to $ 119 the barrel.

Yesterday’s decision to increase production by 648,000 barrels per day in July and August instead of the 432,000 barrels previously agreed is considered to be barely enough for a tight market.

The increases were distributed proportionally between Member States, but with Russia included in the pact and members such as Angola and Nigeria already having failed to meet their targets, analysts estimate that supply growth is likely to be less than the one that was announced.

Russian production has already fallen by 1 million barrels since the invasion of Ukraine, and is likely to fall further as the EU ban on Russian oil takes effect.

“Markets have judged OPEC + ‘s moves and clearly believe that they will not have a significant impact on the global supply / demand balance,” said Jeffrey Halley of OANDA.

At the same time, the weekly report in the US showed that the country’s stocks fell more than expected by 5.1 million barrels, as well as gasoline, emphasizing how tight the market remains.

At the same time, China has eased restrictions on the spread of the coronavirus in Shanghai and Beijing, which is expected to further boost global demand.