Oil Holds Near $72 as OPEC+ Plans Later and Slower Output Return
Oil endured a choppy session, trading slightly higher after OPEC+ announced plans to defer supply increases for three months but still add barrels from April to a market that’s expected to be oversupplied.
Brent crude traded above $72, flipping between gains and losses. The Organization of the Petroleum Exporting Countries and its allies agreed to delay their planned output hike, a move that will see supplies returned from April 2025 until September 2026, a slower pace than previously planned.
Crude has been caught in a tight range since mid-October, with volatility ebbing. Prices have been influenced by competing drivers including signs of softer Chinese demand and the prospect of a second Donald Trump presidency, which may see support for domestic oil production but tighter sanctions against flows from Iran and Venezuela.
The OPEC+ delay until April comes against against the backdrop of a market that the International Energy Agency says will be oversupplied next year. Underscoring the challenges it faces, seaborne oil flows globally soared in November, and data on Wednesday showed US crude production hit a record above 13.5 million barrels a day while US shipments of refined fuel overseas reached the second-highest ever.
“OPEC+ is most certainly still in the ‘protect price’ mode having kicked the can down the road for the third time,” said Ole Hansen, head of commodities strategy at Saxo Bank. “Hopefully by March they and us will be wiser regarding the impact of Trump’s policies and China’s potential stimulus response and also whether Iran’s output has suffered from additional sanctions.”
Brent edged higher to $72.79 a barrel at 1:53 p.m. in London.
WTI traded at $69.06 a barrel.
Source : Bloomberg
