NEW YORK: Oil prices climbed nearly 3% on Monday on OPEC+’s decision to delay plans to increase output by a month, while the market braced for a critical week in which Americans will elect a new president.
Brent futures were up $2.05, or 2.8%, at $75.15 a barrel by 12:50 p.m. ET (1750 GMT). US West Texas Intermediate (WTI) crude rose $2.09, or 3.0%, to $71.56.
On Sunday, OPEC+ said it would extend its output cut of 2.2 million barrels per day (bpd) for another month in December, with an increase already delayed from October because of falling prices and weak demand.
OPEC+, which includes the Organization of the Petroleum Exporting Countries plus Russia and other allies, had been due to increase monthly output by 180,000 bpd from December.
The extension through all of the fourth quarter of 2024 “casts doubt on the group’s commitment (or wherewithal) to return supply at all” in 2025, said Walt Chancellor, an energy strategist at Macquarie, adding that the announcement may allay some fears of a renewed OPEC+ “price war.”
OPEC remains very positive on demand for oil in both the short and long term, Secretary General Haitham Al Ghais said at an energy industry event in Abu Dhabi on Monday.
French oil major TotalEnergies forecast global oil demand will peak after 2030 in its two most likely energy transition scenarios in its annual energy outlook report.
Meanwhile, the CEO of Italian energy company Eni said that OPEC+ oil supply cuts and recent efforts to unwind them had increased volatility in energy markets and hampered investment in new production.
OPEC oil output rebounded in October from its lowest this year the previous month as Libya resolved a political crisis, a Reuters survey found, although a further Iraqi effort to meet its cuts pledged to the wider OPEC+ alliance limited the gain.
US Democratic nominee Kamala Harris and Republican Donald Trump remain virtually tied in opinion polls ahead of Tuesday’s Election Day, and the winner might not be known for days after voting ends.
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