Brent crude futures for January delivery rose to $ 48.24 a barrel on Wednesday morning. The last time the oil of this brand was traded at this level in March 2020, UNN reports with reference to Bloomberg.
According to the publication as of 8:01, the price of futures for Brent oil rose by 0.79%.
At the same time, the price of January futures for WTI oil rose to $ 45.20 per barrel, adding 0.65%.
It will be recalled that the world oil market experienced a “black Monday” on March 9 – the largest sharp drop in prices since 1991 with the start of the Gulf War. After that, there were several more price collapses in the oil market – against the background of the situation with the coronavirus and restrictions due to the pandemic in the world’s largest economies, leaving the market overwhelmed by a sharp decline in demand and excessive oil surplus.
On April 12, OPEC + member states, including Russia, agreed to reduce oil production in a pandemic.
News of progress on COVID-19 vaccines has recently contributed to some increase in oil prices.
Currently, the OPEC + production reduction agreement provides for a production limit of 7.7 million barrels per day. In the April OPEC + agreement, producers were offered to reduce production to 5.8 million barrels per day from the beginning of 2021 to the end of April 2022. However, analysts predict that at the meetings scheduled for November 30 and December 1, OPEC + will probably agree to maintain current quotas – postponing the originally planned increase of two million barrels per day for January.
Yes, OPEC and its allies are expected to extend the agreement to cut oil production in the new year to avoid a global surplus. However, amid a rapid increase in the number of COVID-19 patients in many parts of the world and an increased risk of further economic constraints, the cartel’s efforts may fail if demand for oil falls faster than supply, MarketWatch said.
