Oil prices rose more than 4% in trading today, Wednesday, to compensate for some sharp losses from the previous session.
The price hike comes as investors await the OPEC+ meeting to discuss how to respond to the threat of lower fuel demand with the spread of the omicron mutant.
Oil Prices Today
Brent crude futures prices – for February 2022 delivery – rose by 4.46%, recording $72.32 a barrel, after falling 3.9% on Tuesday.
The price of West Texas Intermediate crude futures – January delivery – also rose by 4.25%, recording $68.99 a barrel.
Last November, US crude recorded losses of about 20.8%, to be the worst monthly performance since March 2020, and Brent crude recorded monthly losses of about 16.8%.
OPEC Meeting
The Organization of Petroleum Exporting Countries “OPEC” meets today, Wednesday, after 13:00 GMT, and before the meeting on Thursday of the OPEC + alliance that brings together OPEC with other oil producers, including Russia.
Some analysts expect OPEC+ to hold off plans to add 400,000 barrels per day of supply in January, in light of the potential impact on oil demand rates as a result of travel restrictions to curb the spread of the omicron mutator, at a time when several OPEC+ ministers have said there is no A need to change the current production increase plans.
“Since the United States and other countries have agreed to draw from the Strategic Petroleum Reserve to control price hikes, and since prices have corrected from $85 a barrel to nearly $70, OPEC + may reconsider its strategy.”
He added, there is a possibility that this will happen, given the variable of the new Corona virus and its impact on global oil prices, especially in the aviation sector, even if OPEC + agrees to move forward with the planned supply increase in January, producers may find it difficult to add that much .
OPEC Production
In a sign of producers’ fear of the impact of the new coronavirus outbreak on demand and oil prices, a Reuters survey found that OPEC pumped 27.74 million barrels per day in November, up 220,000 barrels per day from the previous month, but that was less than the increase The 254,000 barrels per day allowed for OPEC members under the OPEC+ agreement.
In another indication of the impact on oil demand, data from the American Petroleum Institute industry group showed that US crude inventories fell by 747,000 barrels in the week ending November 26, which is less than expected.
SOURCE : REUTERS
