The members of the Organization of Petroleum Exporting Countries and its allies, led by Russia, (OPEC +) affirmed that this cartel is not responsible for oil prices in the international market and will not increase production as requested by the president of the United States. , Joe Biden.
OPEC + agreed to limit its production increase to 400,000 barrels a day in December, despite consumers demanding more important measures to moderate the price hike.
The cartel’s monthly production “will be adjusted upwards by 400,000 barrels a day by December,” OPEC announced in a statement after a summit of its 13 members together with its ten allies through the OPEC + agreement.
It is unacceptable that Russia and Saudi Arabia are not going to pump more oil so that people can have gasoline to get to and from work, “said Joe Biden, president of the United States, from the UN Conference on Climate Change.
The leader of the leading oil-consuming country has reason to be angry: the benchmark US contract, the WTI, was at around $ 85 a barrel earlier this week, very close to its highest level since 2014.
OPEC + insists on risk factors on demand to justify maintaining its prudent policy. He also mentioned the new increases in Covid-19 infections observed in Russia and China.
“The crisis continues, we must pay attention and not end things,” said the Saudi Minister of Energy and OPEC leader Abdelaziz bin Salmán at the end of October.
Prices down
This Thursday, in New York, a barrel of West Texas Intermediate (WTI) for December ended with a drop of 2.54% or 2.05 dollars to trade at 78.81 dollars.
In London, North Sea Brent for January delivery fell 1.77%, or $ 1.45, to $ 80.54.
Yesterday, the Mexican export mix was not listed due to a holiday in Singapore, as published by Petróleos Mexicanos on its website.
The market is full of rumors about a potential coordinated initiative to use strategic oil reserves to combat rising prices, “summed up John Kilduff of Again Capital.
The OPEC + decision, despite requests from consuming countries, was perceived “as a disappointment by the United States, which expects an increase closer to 600,000 barrels a day,” said Ann-Louise Hittle, an analyst at Wood Mackenzie. .
The discontent of the White House made prices drop suddenly from midday.
“The reactivation should not be weakened by an imbalance between supply and demand. OPEC + seems not to want to use its capacity and its power over the supply of crude, at this crucial moment in the global reactivation,” deplored a spokesman for the National Security Council. .
Oil prices tumbled on Thursday, reversing gains from the start of a volatile session, after Saudi production was reported to soon exceed 10 million barrels a day for the first time since the start of the Covid pandemic. 19.
The report by the Saudi television network Al Arabiya came after the nation, along with other partners of the Organization of the Petroleum Exporting Countries and its allies, agreed to maintain the previously agreed production increases and not to comply with the request of the White House to raise its daily production.
Since Tuesday’s close, Brent and WTI have fallen 5% and 6%, respectively.
OPEC and its allies have agreed to stick to their plans to increase oil production by 400,000 barrels a day, sources said, despite calls from the United States to deliver an additional supply to cool the rise in prices.
Oil reserves will experience a “tremendous” build-up in late 2021 and early 2022 due to the slowdown in consumption, Abdulaziz bin Salman said.
The world’s leading producers are also confident that higher crude prices will not prompt a quick response from the US shale industry.
However, several large oil companies plan to increase production or spending on shale next year, which could undermine OPEC + efforts to control supply and support prices.
Oil demand before Covid-19 stood at 100.3 million barrels a day, according to OPEC data. In 2020, in the middle of the pandemic, it fell almost 10%, to 90.9 million barrels per day.
With demand picking up, crude prices are at a seven-year high.
(With information from Agencies)
Reference-www.eleconomista.com.mx