Oil prices rose during trading on Tuesday, reaching their highest levels in at least 3 years.
Oil prices continued to reap the gains made during the previous session, after the world’s major oil producers within the OPEC + alliance announced to maintain a ceiling on crude supplies.
Oil prices today
By 08:00 am GMT, Brent crude futures prices – for December delivery – rose 0.58%, recording $81.73 a barrel, after rising by 2.5% in the previous session.
The prices of West Texas Intermediate crude futures – for December delivery – also rose by 0.35%, recording 77.89 dollars a barrel, after rising by 2.3% yesterday, Monday, the highest level since November 2014.
The Organization of Petroleum Exporting Countries “OPEC” led by Saudi Arabia and its allies from abroad led by Russia, in the alliance known as OPEC +, decided yesterday, Monday, to maintain an agreement to increase oil production only gradually, ignoring calls from the United States and India to increase production with the world.
The OPEC+ alliance agreed in July to increase production by 400,000 barrels per day each month until at least April 2022 to phase out 5.8 million barrels per day of existing cuts.
Oil prices have already risen by more than 50% this year, a rise that has added to the inflationary pressures that crude oil consuming countries feel will impede the recovery from the pandemic.
A source said that despite pressure to increase production, OPEC + was concerned that a fourth global wave of Corona injuries could harm the recovery of demand, Reuters reported.
Russian Deputy Prime Minister Alexander Novak confirmed after the OPEC + ministers’ talks that the market is now balanced.
For its part, “Capital Economics” expected a gradual normalization in demand growth and the recovery in supply will begin to affect oil prices from the fourth quarter.
This year, demand growth has outpaced supply, helping prices reach multi-year highs, Capital said in a note.
Meanwhile, US crude oil and distillate inventories are likely to have declined last week, according to a preliminary poll by Reuters.
And 5 analysts estimated that crude stocks fell by about 300,000 barrels in the week ending on October 1.
“In the short term, the oil market may be volatile…However, the main trend remains intact, and deep pullbacks will provide buying opportunities,” said Avtar Sandhu, senior commodity manager at Phillip Futures in Singapore.