Brent Breaches $79 On OPEC’s Production Cut Pledges

The New Diplomat
Writer

Ad

Global CEOs, Top Diplomats, Ministers, Governors, Industry leaders gather in New York to unlock the Gulf of Guinea’s over $800 billion Energy, Oil & Gas, Minerals, Maritime Opportunities

By Abiola Olawale Following the official opening of the 80th Session of the United Nations General Assembly (UNGA80), New York, USA, high-level delegations from over a dozen countries, including global CEOs, top diplomats, ministers, governors, industry leaders will gather in New York to unlock the Gulf of Guinea’s over $800 billion Energy, Oil & Gas,…

Charted: Populations of China, India, U.S., and Europe (1950–2100)

Key Takeaways India is projected to remain the world’s most populous country through 2100, stabilizing around 1.5 billion people. China’s population is expected to fall by more than half, from 1.4 billion to 0.6 billion. Europe’s population will decline steadily, while the U.S. population grows gradually to 420 million. As global demographics continue to shift,…

Elon Musk drops to second place as AI boom powers Oracle’s Larry Ellison to world’s richest status

By Obinna Uballa Elon Musk has lost his long-held crown as the world’s richest person to Oracle co-founder Larry Ellison, following a record-breaking surge in Ellison’s net worth. According to Bloomberg’s Billionaire Index, Ellison’s fortune jumped by an unprecedented $101 billion on Tuesday night to reach $393 billion, surpassing Musk’s $385 billion. The windfall came…

Ad

By Julianne Geiger

Oil prices climbed on Tuesday as the oil markets began to believe the narrative that oil could tighten in the second half of the year.

Brent crude oil climbed above $79 per barrel on Tuesday, the highest price in months for the international oil benchmark, although still off last year’s prices by about $20 per barrel.
WTI prices reached $74.52 per barrel on Tuesday, an increase of $1.60 (+2.19%) per barrel.

Last week, Saudi Arabia announced that it was extending its 1 million bpd production cut into the month of August. It originally had voluntarily agreed to an extra million bpd for July only. Oil prices responded immediately with a 1% increase, and have increased since that time.

A few traders suggested the markets should have responded with a bigger bang, but skepticism about the market’s fundamentals—like China’s demand outlook—keep getting in the way of OPEC’s price hike aspirations.

It’s been a push/pull scenario with OPEC’s production cuts on one side and China’s demand picture on the other. Today, OPEC’s cuts are winning. This is good news for Saudi Arabia, who put a lot on the line with the additional million bpd production cut this month and the extension into next month.
OPEC’s heaviest hitter is counting on its cuts leading to an oil price rise this half of the year, banking on a tightening market—even if China’s oil demand isn’t as much as some would have liked it to be.

Saudi Arabia had the fastest-growing G20 economy last year, according to the IMF, but its economy could shrink this year 1% if it keeps its cuts in place. That is unless Saudi Arabia’s plan is successful and prices continue to rise.

NB: Julianne Geiger wrote this article for Oilprice.com

Ad

Unlocking Opportunities in the Gulf of Guinea during UNGA80
X whatsapp