Oil rises in price after OPEC+ maintains output cuts, but is heading for a weekly loss
Kyiv • UNN
Oil prices rose on Friday after OPEC+ decided to keep its oil production policy unchanged, although prices were on track for a weekly drop due to unfounded reports of a ceasefire between Israel and Hamas.
Oil prices rose on Friday following OPEC+'s decision to keep its oil production policy unchanged, although benchmark prices were headed for a weekly drop amid unfounded reports of a ceasefire between Israel and Hamas, Reuters reports, UNN writes.
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Brent crude oil futures rose by 44 cents, or 0.6%, to $79.14 per barrel by 09:30 Kyiv time, and West Texas Intermediate futures rose by 36 cents, or 0.5%, to $74.18 per barrel.
On Thursday, two sources in OPEC+ said that the group has kept its oil production policy unchanged and will decide in March whether to extend the voluntary oil production cuts for the first quarter.
The Organization of the Petroleum Exporting Countries (OPEC) and its Russian-led allies, known as OPEC+, planned a 2.2 million barrels per day production cut for the first quarter, as announced in November.
Analysts at ANZ Research said in a note on Friday that these production cuts should support supply cuts in the first quarter, as non-OPEC production growth normalizes and US production growth slows to 300,000 bpd in 2024 from 800,000 bpd last year.
Oil prices were also supported by the US Federal Reserve's decision to keep the benchmark overnight interest rate at 5.25%-5.50% and comments by Chairman Jerome Powell, who said that interest rates had peaked and would decline in the coming months.
However, oil prices were on track to fall by about 5% on a weekly basis, as unsubstantiated reports of a ceasefire between Israel and Hamas limited growth and led to a decline in contracts of more than 2% on Thursday, the publication said.
"Recent reports of progress in expanding the ceasefire agreement between Israel and Hamas, which could ease the current geopolitical stress, are keeping oil investors on the sidelines," said Priyanka Sachdeva, senior market analyst at Phillip Nova.
Russian oil tankers also continue to sail through the Red Sea, largely without Houthi attacks, which contrasts with market perceptions of significant disruptions to global oil supply flows, Sachdeva said.
In the latest round of tensions over shipping, Iranian-aligned Houthi militants in Yemen claimed on Thursday that their navy attacked an unidentified British merchant ship in the Red Sea.
