Business

Oil prices advanced after OPEC+ production consensus

04 Dec 2020

Picture used for illustrative purpose. File

Gulf Today Report

Oil prices gained by 2% on Friday on course for its fifth week of an increase due to consensus by major producers to retain the cut of production.

Brent was up $1.04, or 2.1%, at $49.75 a barrel by 05:55 GMT after gaining around 1% on Thursday. West Texas Intermediate rose 84 cents, or 1.8% to stand at $46.48 a barrel.

Following its meeting, OPEC+ will be easing deep oil output cut by 500,000 barrels per day in January.

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However, there hasn’t been an agreement on policy for the rest of the year.

According to a report by Goldman Sachs, "OPEC+ clearing the hurdle of exiting its current cuts in a coordinated way ... reinforces our conviction in a steady and sustainable rally in oil prices through 2021."

The increase translates that OPEC+ will be cutting production by 7.2 million barrels per day or 7% of world demand from January. This is a reduction from its current cut which is 7.7 million barrels per day.

OPEC+ was expected to continue existing cuts until at least March.