Crude oil climbs up on indication that OPEC+ could reassess output

Highlights

  • Crude oil prices rose on Monday.
  • The prices of both the benchmarks tumbled more than US$1 per barrel during the early trading sessions.
  • Officials from Japan and India are working with the US to release national crude oil reserves to cool down rising oil prices.

Crude oil prices rose on Monday recording gains on previous losses on the news that OPEC along with its allies may rethink their plans of increasing production if leading economies release crude oil from their strategic reserves or if coronavirus pandemic dampens demand. January delivery Brent Crude oil futures last traded at US$79.47 per barrel down 0.04%, whereas January delivery WTI crude oil futures traded 0.36% down at US$76.47 per barrel as of 23 November 2021 at 12:01 PM AEDT.

The prices of both the benchmarks tumbled more than US$1 per barrel during the early trading sessions to reach the lowest level since 1 October 2021.

Release of oil from strategic reserves

Officials from Japan and India are working with the US to release national crude oil reserves to cool down rising oil prices.

The significant decision to release oil from strategic reserves come after the US government was unable to persuade the OPEC+ countries to pump more oil.

OPEC

OPEC | Source: © Gumpapa | Megapixl.com

Earlier this month, the cartel agreed to stick to their original plan of increasing the output by 400,000 bpd from December.

Additionally, the worries about demand were further fed by the prospects of national lockdowns in Europe, which has pressurised oil prices. Austria has announced its fourth national lockdown on Monday.

Bottom Line

Crude oil prices surged significantly on news that OPEC+ may re-assess its plan of increasing the oil output as the leading economies plan to release oil from their strategic reserves.

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