Crude oil prices climbed higher on Monday, the first session of the year 2022 amid hopes the Organization of the Petroleum Exporting Countries and its allies will stick to their plan to raise monthly crude production by the previously decided 400,000 barrels per day.
The group is scheduled to meet on Tuesday via videoconference to determine production levels for February.
Oil’s uptick was also due to reports that Libya, one of OPEC’s more important oil drillers, will likely lose about 200,000 barrels daily in output over the next week because of a damaged pipeline.
Oil prices rose today despite major cities across the world announcing changes to their travel guidelines and coronavirus disease (Covid-19)-related protocols amid an exponential surge in new coronavirus cases.
West Texas Intermediate Crude oil futures for February ended up by $0.87 or about 1.2% at $76.08 a barrel.
Brent crude futures are up $1.20 or 1.54% at $78.98 a barrel.
The OPEC+ is of the view that the impact to oil demand from the Omicron variant will be “mild and short-lived.”
Last week, Saudi King Salman called on all oil producers to stick with the alliance’s recommendations and output caps to ensure market stability.
OPEC’s new Secretary-General Elect Haitham Al Ghais said today that one of the group’s “major priorities is to promote the continuation of the OPEC+ pact through 2023.” He was referring to the production controls between the Saudis and Russians that have largely put a floor beneath crude prices since 2016.
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