Oil climbed toward $82 a barrel on indications the OPEC+ alliance is considering slashing production by more than 1 million barrels a day to revive plunging prices when it meets this week, APA-Economics reports citing Bloomberg.
A reduction of that magnitude would be the biggest since the pandemic, although OPEC+ delegates said a final decision on the size of the cuts wouldn’t be made until ministers gather in Vienna on Wednesday. West Texas Intermediate rose more than 2%, putting prices on track for the first gain in three sessions.
“The slide in oil prices is likely over,” said Ed Moya, senior market analyst at Oanda Group. “Energy traders turned pessimistic over the summer gave global slowdown fears, but now it seems the risks for oil are to the upside.”
Oil fell by a quarter in the three months through September as a slowing global economy sapped demand. Banks, including UBS Group AG and JPMorgan Chase & Co., said the Organization of Petroleum Exporting Countries and its allies might need to trim output by at least 500,000 barrels a day to stabilize prices.
A cut of more than 1 million barrels a day “will be enough to put a floor under prices,” said Phil Flynn, a senior market analyst at Price Futures Group.
A large output cut may draw criticism from the US and other major consuming nations, where energy-driven inflation has forced central banks to jack up interest rates aggressively. This week’s OPEC+ meeting will be the first in-person gathering since March 2020. The group is deciding on supply for November.
Follow us on Telegram
t.me/apanewsaz
Follow us on Instagram
Follow us on Facebook
Follow us on Twitter
