Oil is stabilizing, after OPEC says the release of reserves will inflate profits | MCU Times

Oil is stabilizing, after OPEC says the release of reserves will inflate profits

Oil was stable, with US traders on holiday, after OPEC said a planned coordinated release of reserves could increase a crude oil surplus expected early next year.

Futures in New York traded just over US $ 78 per share. barrel for the third day in a row, and the quantities were thin with Thanksgiving in the United States. The surplus warning was issued by the producer group’s advisory body ahead of a meeting with allies next week. Some of the cartel’s delegates warned this week that the release of strategic reserves could lead to the group holding back crude oil supplies back in January.

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Raw oil had fallen over the past month as President Joe Biden agitated for a response to rising energy prices, but the landmark plan announced Tuesday did not live up to expectations and saw prices rise. The International Energy Agency accused Saudi Arabia, Russia and other major energy producers of creating “artificial densities” in global oil and gas markets and called on OPEC + to speed up the return of supplies.

Predictions about the response are mixed. Citigroup Inc. said OPEC + is likely to stick to its planned increase of 400,000 barrels a day for January because a reduction in supply will erode the group’s claim to supply public goods by stabilizing oil markets. Australia & New Zealand Banking Group said, however, that the alliance will suspend the increase to provide a buffer to require headwinds.

“The progress of the six consuming nations will certainly result in aftershocks as the dividing lines between OPEC + and large consuming countries become increasingly visible,” said Tamas Varga, an analyst at brokerage firm PVM.

Prices

  • West Texas Intermediate was 0.5 percent lower at $ 78.03 per share. barrel around 1 p.m. in New York when trading stopped. Contracts are not settled until Friday due to the holiday.
  • Brent settled just 3 cents lower from Wednesday at $ 82.22 per share. barrel.
  • The rapid time spread for Brent has increased this week and traded $ 1.30 in decline compared to 88 cents a week ago.

OPEC’s advisory body predicted that profits in the markets would grow by 1.1 million barrels a day in January and February to 2.3 million and 3.7 million a day, respectively, if 66 million barrels were injected by major consumers in two -month period, according to a document obtained by Bloomberg.

Other market news:

  • Asian oil refineries are beginning to see a recent resurgence of profitability go in the opposite direction, eroding a source of demand strength that helped drive crude oil prices to a seven-year high last month.
  • Slate researchers in the US show no signs of accelerating the pace of the spread of drilling rigs, despite criticism from the Biden administration that they are holding back production to the detriment of consumers.

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