London — Oil on Monday was stable prior to a meeting by OPEC and its allies that may determine whether recent price increases will continue in the midst of supply shock and recovery from the COVID-19 pandemic.
Brent crude fell 6 cents (0.1%) by 0935 GMT to $ 79.22 a barrel. It rose 1.5% last week, rising for the fourth straight week. US oil fell 13 cents (0.2%) to $ 75.75 after rising over the past six weeks.
Oil prices rose due to supply turmoil and rising global demand, pushing Brent to a high of nearly three years above $ 80 last week.
“Our basic expectation for today’s OPEC meeting is to continue the existing agreement that OPEC will eliminate about 400,000 barrels per day of production cuts each month,” Morgan Stanley said in a memo.
“But if there is a reason to do so, it is because OPEC’s own oil consumption is recovering rapidly.”
OPEC +, which groups allies, including OPEC and Russia, faced pressure to produce more to lower prices as demand recovered faster than expected in certain parts of the world. I am.
In July, OPEC + agreed to increase monthly production by 400,000 barrels per day (bpd) until at least April 2022, phasing out existing savings of 5.8 million barrels.
The rise in oil prices has skyrocketed by 300% and is also fueled by even greater rises in gas prices, which are trading at about $ 200 a barrel under comparable conditions, and fuel oil for power generation and other industrial needs. And other crude oils are being encouraged to switch.
“The non-uniform nature of the post-pandemic recovery maintains demand-side uncertainty and causes fluctuations in oil prices,” Fitch Solutions said in a memo.
Noah Browning
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