• Sign up for the Daily Digest E-mail
  • Facebook
  • X
  • LinkedIn

BOE Report

Sign up
  • Home
  • BOE Intel
  • Headlines
    • Latest Headlines
    • Featured Companies
    • Columns
    • Discussions
  • Well Activity
    • Well Licences
    • Well Activity Map
  • Property Listings
  • Land Sales
  • M&A Activity
    • M&A Database
    • AER Transfers
  • Markets
  • Rig Counts/Data
    • CAOEC Rig Count
    • Baker Hughes Rig Count
    • USA Rig Count
    • Data
      • Canada Oil Market Data
      • Canada NG Market Data
      • USA Market Data
      • Data Downloads
  • Jobs

Oil near three-week high on cuts to OPEC+ output targets

October 6, 20226:39 AM Reuters

LONDON, Oct 6 (Reuters) – Oil prices held near three-week highs on Thursday after OPEC+ agreed to tighten global crude supply with a deal to cut production targets by 2 million barrel per day (bpd), the largest reduction since 2020.

Brent crude futures edged down 16 cents, or 0.2%, to $93.21 per barrel by 1020 GMT after settling 1.7% up in the previous session.

U.S. West Texas Intermediate (WTI) crude futures lost 14 cents, or 0.2%, to $87.62 after closing 1.4% up on Wednesday.

The agreement between the Organization of Petroleum Exporting Countries (OPEC) and allies including Russia, a group known collectively as OPEC+, comes ahead of a European Union embargo on Russian oil and would squeeze supplies in an already tight market, adding to inflation.

“We believe that the price impact of the announced measures will be significant,” said Jorge Leon, senior vice-president at Rystad Energy.

“By December this year Brent would reach over $100/bbl, up from our earlier call for $89.”

Saudi Energy Minister Abdulaziz bin Salman said the real supply cut would be about 1 million to 1.1 million bpd. Saudi Arabia’s share of the cut is about 0.5 million bpd.

Several OPEC+ members have been struggling to produce at quota levels because of underinvestement and sanctions.

U.S. President Joe Biden’s administraion criticised the deal as “shortsighted” and the White House said Biden would continue to assess whether to release further strategic oil stocks to lower prices.

The White House said it would consult Congress on additional paths to reduce the control OPEC and its allies hold over energy prices in an apparent reference to legislation that could expose members of the group to antitrust lawsuits.

“This quota reduction is somewhat at odds with global crude oil inventories that are already low, and mostly still trending lower,” U.S. bank Morgan Stanley said.

“Nevertheless, OPEC+ emphasised the significant uncertainty over oil demand into 2023, highlighting recent sharp downward revisions to GDP forecasts and rising recession probabilities.”

Separately on Wednesday, Russian Deputy Prime Minister Alexander Novak said Russia could cut oil output in an attempt to offset the effects of price caps imposed by the West over Moscow’s actions in Ukraine.

A draw in U.S. oil stockpiles last week also supported prices. Crude inventories dropped by 1.4 million barrels to 429.2 million barrels in the week ended Sept. 30, the Energy Information Administration said.

 

Strategic Oil

Follow BOE Report
  • Facebook
  • X
  • LinkedIn

Sign up for the BOE Report Daily Digest E-mail

Successfully subscribed

Latest Headlines
  • Strathcona Resources cements its reputation as a strategic counter cyclical acquirer with Pipestone shareholders approval of acquisition – BOE Intel
  • Enbridge Gas announces new capacity open season for C1 transportation service
  • Pipestone shareholders approve arrangement with Strathcona to create new Canadian energy leader
  • US natgas prices up 2% on forecasts for higher demand, lower output
  • Oil and gas activity rises modestly, but cost increases continue – Dallas Fed survey

Return to Home
Alberta GasMonthly Avg.
CAD/GJ
Market Data by TradingView

    Report Error







    Note: The page you are currently on will be sent with your report. If this report is about a different page, please specify.

    About
    • About BOEReport.com
    • In the News
    • Terms of Use
    • Privacy Policy
    • Editorial Policy
    Resources
    • App
    • Widgets
    • Notifications
    • Daily Digest E-mail
    Get In Touch
    • Advertise
    • Post a Job
    • Contribute
    • Contact
    • Report Error
    Featured In
    • Rigger Talk
    Data Partner
    BOE Network
    © 2023 Stack Technologies Ltd.