LONDON: Oil was stable on Monday ahead of a meeting of OPEC and its allies that could determine whether the recent rally in prices amid supply shocks and the recovery from the COVID-19 pandemic will continue.
Brent crude was down 6 cents, or 0.1 percent, at $79.22 a barrel by 0935 GMT. It rose 1.5 percent last week, its fourth consecutive weekly gain. US oil has fallen 13 cents, or 0.2 percent, to $75.75 over the past six weeks.
Supply disruptions and increased global demand have propelled oil prices, pushing Brent to a three-year high above $80 last week.
“Our base case for today’s OPEC meeting is that OPEC continues with its current agreement to reduce its output by approximately 400,000 bpd each month,” Morgan Stanley said in a note.
“However, if there is a reason to act so fast, it is because OPEC’s own oil consumption is also recovering at a faster rate.”
OPEC+, a grouping of allies including the Organization of the Petroleum Exporting Countries (OPEC) and Russia, is facing pressure from some countries to produce more to help lower prices as demand in some parts of the world exceeds expectations. has grown more rapidly.
OPEC+ agreed in July to phase out 5.8 million bpd of existing cuts to boost production by 400,000 barrels per day (bpd) every month until at least April 2022.
The uptick in oil prices has been driven by an even bigger increase in gas prices, which have risen by 300 percent and are trading at around $200 a barrel in comparable terms, to generate electricity and other industrial needs. are being pushed to switch to fuel oil and other crude products.
“The uneven nature of the post-pandemic will keep demand-side uncertainties at play, leading to volatility in oil prices,” Fitch Solutions said in a note.
by Noah Browning
This News Originally From – The Epoch Times