Oil price rises following OPEC's announcement that it will maintain its current

rojonihafsa1

Oil futures have risen this Monday, the 5th, thanks to good news on demand and supply : OPEC will maintain its production cut target and China softens its zero covid stance, which has raised hopes of demand excessive OPEC+, or the Organization of the Petroleum Exporting Countries, and its allies—including Russia—announced this Sunday the 4th that they will maintain the oil production target that the group set in October : reduce production by 2 million barrels per day from November to end of 2023. The production cut is equivalent to about 2% of global demand and is the largest reduction since the outbreak of COVID-19. Already in October, OPEC+ had stated that the decision was made "in light of the uncertainty surrounding the global economic and oil market outlook." The move angered the United States and the White House accused OPEC+ of "aligning itself with Russia." That's because tighter oil supplies tend to drive up prices, which can help shore up Russia's coffers despite sanctions and boycotts over its invasion of Ukraine.

Senior European officials accuse the United States of benefiting from the Ukraine war On Sunday, OPEC has stated that the move is "purely driven by market considerations." US West Texas Intermediate oil futures rose. Hopes for the Chinese economy to recover from the pandemic are also boosting market sentiment. The expectation that the world's second-largest Jamaica Mobile Number List economy will finally consider an exit from COVID-19 comes after the country's top official in this area appeared to soften the hardline zero-Covid approach last week. Several Chinese cities, such as the financial hub of Shanghai and the technology hub of Hangzhou, have relaxed strict Covid testing rules over the weekend. This is why oil will soon reach $120 per barrel and stay high for the next 2 years The events "point to the beginning of the end of zero covid" in China , although not to a rapid reopening for the entire country, Nomura economists analyze.

In a press release this Monday. However, there is certainly optimism around the easing of Covid restrictions, writes Vishnu Varathan, head of economics and strategy at Mizuho Bank, in another communication on the same day. OPEC's decision comes 2 days after the European Union and the G7 agreed on a cap of 60 dollars (about 57 euros) per barrel for Russian crude oil, a measure that creates uncertainty in oil markets. Prices could rise to $120 (114 euros) a barrel next year if Russia does not find enough "dark ships" — vessels that turn off tracking devices — to covertly export crude, Bernstein analysts estimate . The Russian crude oil price cap goes into effect on Monday. However, Kremlin spokesman Dmitry Peskov has stated that Moscow will not accept the price cap and has made "certain preparations" to counter the measure , the state news agency TASS reported on Friday.