Oil Futures Fall after OPEC+ Sticks to Output Increase
WASHINGTON, D.C. (DTN) -- Nearby delivery month West Texas Intermediate
futures and Brent crude traded on the Intercontinental Exchange weakened in
midmorning trade Thursday after Organization of the Petroleum Exporting
Countries and Russia-led partners agreed on a 400,000 bpd production increase
next month, disappointing expectations for the alliance to keep the output
The decision to increase production came despite growing fears over a winter
surge in COVID infections and projections of an oversupplied oil market. Ahead
of the meeting, OPEC+ technical panel estimated a global oil market supply
surplus would reach 2 million bpd in January, widening further to 3.4 million
bpd in February. In March, OPEC+ expects the surplus to reach a whopping 3.8
OPEC+ is gradually unwinding a record 9.7 million bpd production cut put in
place at the beginning of the pandemic in April 2020 through monthly
installments of 400,000 bpd. The 23-producer alliance is currently withholding
around 3.8 million bpd of crude from the global oil market, with some key
members reportedly struggling to raise production in line with agreed to quotas.
OPEC+ will hold next Ministerial Meeting on Jan. 4, 2022.
Following the OPEC+ news release, NYMEX January West Texas Intermediate
contact softened $0.32 to $65.16 bbl, and international benchmark Brent for
February delivery declined $0.40 to $68.55 bbl.
Liubov Georges, 1.646.359.4088, firstname.lastname@example.org, http://www.dtn.com
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