Oil prices rose to a record high of January 2020

Brent and WTI crude oil prices rose above $ 68 and $ 65 per barrel, respectively. This was the first time since January 8 last year, according to the auction data.

May Brent futures price rose by 1.99 percent to $ 68.07, April WTI futures — by 1.82 percent to $ 64.96. A few minutes earlier, the indicator had increased to $ 65.03.

Quotes are rising for the third trading session in a row, and on the eve of oil rose by more than four percent due to news about the OPEC + deal.

OPEC + decision

On Thursday, the alliance decided to keep production at the same level. Only Russia and Kazakhstan will increase it by 130 thousand barrels per day and 20 thousand, respectively.

Also, Saudi Arabia will maintain a voluntary reduction in production by one million barrels per day compared to January figures.

This decision led to a rise in oil prices, as analysts predicted that the alliance would agree to increase production by half a million barrels.

Commenting on the meeting results, Deputy Prime Minister Alexander Novak stressed that the current deficit reduces the surplus of remaining oil from buyers. However, he added that the market should not be allowed to overheat.

Novak noted that the increase in the production quota for Russia would ensure seasonal demand within the country.

OPEC + Agreement

OPEC+ has reduced oil production by 9.7 million barrels per day since May 2020 due to falling demand caused by the pandemic. As the situation improved, the restrictions were adjusted, and at the beginning of March, they amounted to 7.05 million barrels per day. The reference point for the deal is October 2018, and for Russia and Saudi Arabia — an indicator of 11 million barrels per day.

At the end of last year, the OPEC+ countries agreed to adjust the production level under the agreement in increments of no more than half a million barrels per day per month.

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Author: Steve Cowan
Graduated From Princeton University. He has been at the Free Press since October 2014. Previously worked as a regional entertainment editor.
Function: Chief-Editor

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