- Crude oil prices settled higher on Thursday.
- OPEC+ surprised the market by sticking to its original plan.
- The cartel decided to boost the supply in January.
Crude oil prices settled nearly 1% higher on Thursday after a volatile session witnessing oil benchmarks swinging in a range of US$5 after OPEC+ decided to stick to their original plan to gradually boost the output.
February delivery Brent Crude oil futures last traded at US$70.04 per barrel down 0.54%, whereas January delivery WTI crude oil futures traded 0.72% up at US$66.98 per barrel as of 3 December 2021 at 12:09 PM AEDT.
OPEC’s plan to gradually increase supply
The decision of the Organization of the Petroleum Exporting Countries coupled with its allied, combinedly known as OPEC+ surprised the market by sticking to their original plan of gradually boosting the monthly production by 400,000bpd.
The cartel decided to boost the supply in January, similar to the previous months to phase out the previous cuts agreed in 2020. The US welcomed the group’s decision, but the country has no plans to reconsider its decision to release oil from its strategic reserves.
Source: © Gumpapa | Megapixl.com
Both the crude oil benchmarks have been under pressure for weeks due to the plan of the US coupled with other oil-consuming nations to release oil from their strategic reserves. Additionally, the rising fears of the new variant of coronavirus – Omicron has further dampened the oil demand.
Crude oil prices rose nearly 1%, following a volatile session on Thursday. The crude oil prices are under pressure due to concerns of rising cases of Omicron and initiatives taken by global oil consumers to release oil from their strategic reserves to cool oil prices.