Oil rates increase amid OPEC+ disputes, supply uncertainty

11/29/2023 2:25:26 AM

(MENAFN) On Tuesday, oil rates saw an increase amid heightened supply uncertainty, fueled by reports of disagreements among OPEC+ members over production quotas for the upcoming year.

The international benchmark brent crude traded at USD80.50 per barrel at 11:40 AM regional time (0840 GMT), marking a 0.79 percent rise from Monday's closing price. Concurrently, the American benchmark West Texas Intermediate (WTI) traded at USD75.47 per barrel, reflecting a 0.81 percent increase from the previous session's close of USD74.86 per barrel.

Global oil markets are influenced by ongoing supply uncertainties, with the OPEC+ meeting originally scheduled for November 26 in Vienna postponed to November 30. During this meeting, the group is expected to decide on production quotas effective from January onward.

Since 2022, OPEC+ has collectively agreed to cut approximately 5 million barrels of daily production. However, this commitment to output reduction has not effectively addressed the global market's supply excess.

If OPEC+ continues with production cuts, the International Energy Agency projects that the average global oil supply could reach 102.8 million barrels per day, resulting in a surplus of nearly 1.3 million barrels per day.

Investors are closely monitoring statements from US Fed officials for insights into the interest rate policy of the world's largest oil consumer. Additionally, analysts are awaiting macroeconomic data from the US scheduled for later in the day.

Although supply-side concerns slightly eased after Hamas and Israel initiated a prisoner exchange and a four-day humanitarian break, the situation remains dynamic.

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