Crude oil recovers as OPEC plans to reconsider its output if demand suffers 

Highlights

  • Crude oil price recovers on Monday after settling a little higher on Friday.
  • OPEC+ decided to stick to its original plan of gradually increasing the output.
  • The cartel's next meeting is scheduled for 4 January 2022.

Crude oil price recovers on Monday after settling a little higher on Friday on expectations that rising cases of the new variant of coronavirus can subdue energy demands in the future. The prices recovered nearly US$2 per barrel on Thursday after OPEC+ stated that it could review its policy to increase the output at short notice if the rising number of COVID-19 cases smothers the demand.

February delivery Brent Crude oil futures last traded at US$71.66 per barrel up 2.50%, whereas January delivery WTI crude oil futures traded 2.55% up at US$66.95 per barrel as of 6 December 2021 at 12:04 PM AEDT.

OPEC’s surprising move

The Organization of the Petroleum Exporting Countries along with its allies, together known as OPEC+ decided to stand with its plan of increasing the output by 400,000bpd in January.

However, the group also stated that it can change its policies if demand suffered from measures to stop the spread of the Omicron variant of coronavirus. The cartel said that they could arrange a meeting before their scheduled meet on 4 January.

OPEC

Source: © Gumpapa | Megapixl.com

Crude oil has been under the challenging phase for weeks as the US along with other leading oil consumers of the globe decided to release oil from their strategic reserves to cool down prices.

Bottom Line

Crude oil prices recover significantly on Monday after trimming earlier big gains on Friday on worries that rising cases of the new variant of coronavirus could dampen the oil demand in the future.

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