- Saudi Arabia, Other OPEC Producers Eyeing Increased Production – WSJ
- Anxiety in China’s demand and strong dollar also weigh on prices
NEW YORK (Reuters) – Oil prices rose to their highest level since early January on Monday after the Wall Street Journal reported that Saudi Arabia and other OPEC producers were considering boosting production by 500,000 barrels a day. plummeted to a low price.
January Brent crude futures fell by $4.07 (4.7%) to $82.93 a barrel by 11:43 am EST (1643 GMT). December US West Texas Intermediate (WTI) crude oil futures fell $4.48, or 5.6%, to $75.60 before the contract expired later Monday. His January contract, which was more active, fell $4.05 (5%) to $76.04.
An increase of up to 500,000 barrels per day (bpd) will be discussed at the OPEC+ meeting on Dec. 4. The Wall Street Journal reported.
Reuters was not immediately able to verify the report.
Bob Yawger, director of energy futures at Mizuho Securities in New York, said of the impact of current oil futures trading at discounted prices, referring to the later-dated contracts, saying, “They basically “It is hard to believe that we are entering a market that is traded in Contango.” “It’s playing with fire.”
The Organization of the Petroleum Exporting Countries (OPEC) and its allies (known as OPEC+) recently lowered their production targets, and de facto leader Saudi Arabia’s energy minister said this month that the group be careful.
If more oil is released at the same time as China’s weaker demand for fuel and a stronger US dollar, the market could go into contango, with more oil being stored and prices falling further, Yoger said. said there is.
Expectations of further interest rate rises have pushed the US dollar higher, making dollar-denominated commodities such as oil more expensive for investors.
The dollar rose 0.9% against the Japanese yen to ¥141.665, its biggest one-day gain since October 14th. read more
“Apart from the weakening demand outlook from China’s COVID containment, today’s US dollar rally is also bearish on oil prices,” said Tina Teng, an analyst at CMC Markets.
“Risk sentiment has been fragile as recent economic data from all major economies points to a recessionary scenario, especially in the UK and the eurozone,” she said. hawk comments Last week’s announcement by the US Federal Reserve also raised concerns about the US economic outlook.
Brent crude oil futures spreads narrowed sharply month-on-month last week, and WTI plunged. contangoreflecting concerns about declining supply.
Additional reporting by Noah Browning, Florence Tan, and Emily Chow Editing by Jason Neely, David Goodman, and David Gregorio
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