OPEC + ‘turned’ oil prices to profits over 1.2%

Oil prices rose on Thursday, after OPEC + reached an agreement to comply with the existing policy of increasing oil production by 400,000 barrels per day for January.

The cartel, however, left the door open for any adjustments in production, depending on new market developments, against the background of the release of crude stocks from the US and other major oil consumers, but also developments with the new Omicron mutation of the coronavirus.

OPEC + continues to resist the US demand for faster oil production, fearing that oversupply could hurt the fragile recovery of the energy sector. Washington has repeatedly called on OPEC + to increase production as US gasoline prices soar.

OPEC + experts said in a report seen by Reuters on Wednesday that the impact from Omicron is not yet clear, although many countries have imposed tougher restrictive measures.

“Demand concerns were already strong and the last thing the crude bulls were waiting to hear was another reversal of current policy by OPEC +,” said Fawad Razaqzada, a ThinkMarkets analyst.

OPEC + “will supply more oil to the world market and thus remove the threat of supply shortages at a time when demand is expected to decline,” Razaqzada said.

“After the OPEC + decision, crude prices recovered from the day low to $ 62.43 a barrel,” as the market realized that this decision is quite smart, proving that OPEC + is playing chess and not checkers, “she said in a comment. Rebecca Babin, senior energy trader of CIBC Private Wealth US.

Thus, the West Texas Intermediate January delivery closed at 93 cents, or 1.4%, at $ 66.50 a barrel on the New York Mercantile Exchange.

A similar course was followed by Brent oil February ended the session by adding 80 cents, or 1.2%, to $ 69.67 a barrel on ICE Futures Europe.