Oil prices climbed on Friday on bets that OPEC+ will discuss output cuts at a meeting on Sept. 5, but the benchmarks were still on track to post their worst weekly drop in four on fears COVID-19 curbs in China and weak global growth will hit demand.<\/p>\n
Brent crude futures rose $1.20, or 1.3 per cent, to $93.56 a barrel at 0117 GMT, while US West Texas Intermediate (WTI) crude futures jumped $1.16, or 1.3 per cent, to $87.77 a barrel.<\/p>\n
Both benchmark contracts slid 3 per cent in the previous session to two-week lows. Brent was headed for a weekly drop of nearly 8 per cent, and WTI was on track to fall about 6 per cent for the week.<\/p>\n
The Organization of the Petroleum Exporting Countries and allies, together called OPEC+, are due to meet on Sept. 5 against a backdrop of sliding prices and falling demand, even as top producer Saudi Arabia says supply remains tight.<\/p>\n
ANZ commodities analyst Daniel Hynes said it might be a bridge too far for OPEC+ to agree to cut output but that top producer Saudi Arabia will likely highlight what it sees as a disconnect between current prices and tight supply fundamentals.<\/p>\n
“They will certainly try to talk up the market as much as possible to better reflect what they see as a tight market, which is exposed to further supply side issues,” he said.<\/p>\n
OPEC+ this week slashed its demand outlook, now forecasting demand to lag supply by 400,000 barrels per day (bpd) in 2022, but it expects a market deficit of 300,000 bpd in its base case for 2023.<\/p>\n
“As Brent prices fall towards $90\/bbl the probability of a supply response from OPEC+ at Monday’s meeting or in October increases,” said National Australia Bank commodities analyst Baden Moore.<\/p>\n
“We expect any reduction in supply from OPEC+ to have a material impact on oil prices given the very low inventory levels globally, limited capacity of supply alternatives and ongoing energy crunch in Europe,” Moore said.<\/p>\n
In the near term, investors are worried about the impact of the latest COVID-19 curbs in China, where the city of Chengdu on Thursday was the latest to order a lockdown that has hit manufacturers like Volvo.<\/p>\n
That came the same day data showed Chinese factory activity in August contracted for the first time in three months amid weakening demand, while power shortages and COVID-19 outbreaks disrupted production.<\/p>\n","protected":false},"excerpt":{"rendered":"
Oil prices climbed on Friday on bets that OPEC+ will discuss output cuts at a meeting on Sept. 5, but the benchmarks were still on track to post their worst weekly drop in four on fears COVID-19 curbs in China and weak global growth will hit demand. Brent crude futures rose $1.20, or 1.3 per cent, to $93.56 a barrel at 0117 GMT, while US West Texas Intermediate (WTI) crude futures jumped $1.16, or 1.3 per cent, to $87.77 a barrel. Both benchmark contracts slid 3 per cent in the previous session to two-week lows. Brent was headed for a […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[133],"tags":[],"class_list":["post-518918","post","type-post","status-publish","format-standard","hentry","category-oil-gas"],"acf":[],"_links":{"self":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts\/518918","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/comments?post=518918"}],"version-history":[{"count":0,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts\/518918\/revisions"}],"wp:attachment":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/media?parent=518918"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/categories?post=518918"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/tags?post=518918"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}