Crude prices gain as OPEC+ extends supply cuts
By Frank Prenesti
Date: Thursday 05 Dec 2024
(Sharecast News) - Oil prices were up on Thursday as OPEC+ members agreed to extend supply cuts for three months to the end of March after their recent non-ministerial meeting.
Eight members of the enlarged OPEC group, led by Saudi Arabia and Russia, said the would keep voluntary production cuts of 2.2 million barrels per day in place until the end of March 2025, with the cuts gradually phased out until the end of September 2026 to "support market stability", they said in a statement after a virtual meeting.
Brent crude rose 39 cents to $72.70 a barrel with West Texas Intermediate up 40 cents to $68.94. Sluggish demand from China and indications from the incoming Trump administration in the US that it will ramp up domestic production have kept a lid on prices.
OPEC+ is made up of the original OPEC states plus 10 more including Russia, Mexico and Kazakhstan.
Algeria, Iraq, Kazakhstan, Kuwait, Oman, Russia, Saudi Arabia and the United Arab Emirates have already twice pushed back production increases that had originally been scheduled to start in October and then in December.
The International Energy Agency has warned that global supply will exceed demand by 1 million barrels per day next year, even if the current OPEC+ cuts remain in place.
OPEC+ nations are currently retaining six million barrels of oil a day, including the 2.2 million that they had been discussing putting back on the market.
Reporting by Frank Prenesti for Sharecast.com
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