Price of Oil Soars , on Fears of Massive , OPEC Production Cut.
On October 3, oil prices skyrocketed to $3 a barrel
as OPEC+ announced a potential reduction of
output by over one million barrels per day (bpd).
Al Jazeera reports that the OPEC+ said the move would be meant to buttress prices with the biggest cut since the beginning of the COVID pandemic.
Reuters reported that sources within the Organization
of the Petroleum Exporting Countries (OPEC+) say the
massive cut could be decided upon in an October 5 meeting.
Another source reportedly said that figure
excludes additional voluntary cuts
made by individual OPEC members.
Dennis Kissler, senior vice president of trading
at BOK Financial, said most traders were
expecting a cut of about 50,000 bpd.
Last month, the group reduced
output by 100,000 bpd. .
After a year of tolerating extremely
high prices, missed targets and severely
tight markets, the [OPEC+] alliance
seemingly has no hesitation when it comes
to acting rapidly to support prices amid
a deterioration in the economic outlook, Craig Erlam, Oanda market analyst, via Al Jazeera.
After a year of tolerating extremely
high prices, missed targets and severely
tight markets, the [OPEC+] alliance
seemingly has no hesitation when it comes
to acting rapidly to support prices amid
a deterioration in the economic outlook, Craig Erlam, Oanda market analyst, via Al Jazeera.
According to Al Jazeera, two sources within
OPEC+ say the group missed production
targets by almost three million bpd in July.
Those sources cited sanctions on some OPEC+
members and low investment by others as
causes for the group's inability to raise output.
According to consultancy FGE, while prices could strengthen in the short term, long term concerns regarding a potential global recession remain.
According to consultancy FGE, while prices could strengthen in the short term, long term concerns regarding a potential global recession remain