Media ININ Economy We Trust
Media In / Agencies 08-12-2018
Oil prices closed higher than 2 percent on Friday after OPEC members and OPEC allies, led by Russia, agreed to cut output to absorb an abundance of global fuel stocks and support the market, but gains constrained fears cuts would not be enough to curb growing production.
OPEC and its allies agreed on production cuts of 1.2 million bpd starting next year, a move that will be reviewed at a meeting in April.
That figure is higher than the 1 million barrels per day threshold expected by the market, despite pressure from US President Donald Trump to cut crude prices.
Iraqi Oil Minister Thamer Ghadhban said after OPEC concluded two days of talks in Vienna that the Organization would cut production by 800,000 bpd starting in January, while its allies would contribute further cuts of 400,000 bpd.
Russia’s pledge to cut output by 228,000 barrels per day (bpd) from October’s 11.4 million barrels per day (bpd), although it said the cuts would be gradual and would take place over a few months.
Global Brent crude futures closed the day at $ 1.61, or 2.7 percent, at $ 61.67 per barrel. In early trade, Brent fell below $ 60 a barrel as oil exporters appeared to remain on target levels of production unchanged. And then jumped to a high of $ 63.73 on the news of the deal before falling back in late trading.
US WTI crude was at $ 52.61 a barrel, up $ 1.12, or 2.2 percent, after hitting a session high of $ 54.22.
The benchmark crude oil futures ended the week with gains with Brent rising 4.8 percent and US crude at 3 percent.
