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Goldman Sachs Group Inc. said that the deal would support its constructive view on oil, while cautioning that near-term prices may “gyrate” amid concern about the delta variant. The group’s planned increase in supply was “moderate” and would keep the market in deficit, the bank said in a report.
Brent’s prompt time spread was little changed at 63 cents a barrel in backwardation, a bullish pattern with near-dated prices trading above those further out. That’s down from 74 cents a week ago.
The delta variant is still on the ascendant, especially among the unvaccinated, with some countries reimposing curbs. In Asia, Indonesia, Thailand, South Korea, Vietnam and Singapore are all dealing with outbreaks. Elsewhere, the U.K. on Saturday reported the most cases since January.
The OPEC logo pictured ahead of an informal meeting between members of the Organisation of the Petroleum Exporting Countries. Reuters/File
VIENNA: The world’s leading oil producers agreed on Sunday to continue to modestly boost output from August reaching a compromise after the United Arab Emirates blocked a deal earlier this month.
An OPEC+ meeting decided to raise output by 400,000 barrels per day (bpd) each month from August to help fuel a global economic recovery as the pandemic eases, the group’s Vienna-based secretariat said in a media statement.
The grouping will “assess market developments” in December, it said. The deal also extends a deadline on capping output from April next year to the end of 2022.
OPEC, allies agree to raise oil production
Jon Gambrell
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Dubai, United Arab Emirates OPEC and allied nations agreed Sunday to raise the production limits imposed on five countries next year and boost their production by 2 million barrels per day by the end of this year, ending a dispute that roiled oil markets.
The disagreement, sparked by a demand by the United Arab Emirates to increase its own production, temporarily upended an earlier meeting of the cartel. In a statement Sunday, the cartel announced that Iraq, Kuwait, Russia, Saudi Arabia and the UAE would see their limits rise.
“What bonds us together is way much beyond what you may imagine,” Saudi Energy Minister Prince Abdulaziz bin Salman said. “We differ here and there but we bond.”
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(Bloomberg)
(Bloomberg)
OPEC and its allies struck a deal to inject more oil into the recovering global economy, overcoming an internal split that threatened the cartelâs control of the crude market.
An unusually public dispute that tested the groupâs unity was resolved in a classic compromise with Saudi Arabia meeting the United Arab Emirates halfway in its demand for a more generous output limit.
The deal, agreed at a hastily convened Sunday meeting ahead of a long Islamic holiday, allows for monthly supply hikes of 400,000 barrels a day. It puts OPEC+ back in control of the market after two volatile weeks, in which traders considered the possibility that the alliance could unravel.