Oil stabilized on Friday as markets assimilated yesterday’s OPEC + decision to increase production, questioning whether the extra production could make up for lost supply from Russia and meet growing demand from China, in by relaxing the restrictions on coronavirus.
West Texas Intermediate fell 29 cents to $ 116.58 a barrel, while Brent fell 15 cents to $ 117.46 a 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 hardly considered 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.
Source: Capital
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