Oil prices went up more than $2 a barrel on Monday as investors eyed the OPEC+ producers’ meeting later in the day. Brent crude futures rose $2.42, or 2.6%, to $95.44 a barrel by 0641 GMT on Monday. U.S. West Texas Intermediate crude rose $2.05, or 2.4%, to $88.92 a barrel after gaining 0.3% the previous day.
OPEC and its partners, known as OPEC+, may decide at their meeting on Monday to keep production at the same level or cut production to raise prices.
“OPEC+ will likely keep output restricted enough to maintain the oil price amid demand disruptions,” says CMC Markets analyst Tina Teng.
The Wall Street Journal said Sunday that Russia, the world’s second-largest oil producer and a key OPEC+ member, does not favor a production cut at this time, citing unidentified sources.
“While we expect the group to keep output unchanged, the rhetoric may be bullish to arrest the recent price fall,” ANZ analysts said.
Even though output cuts are possible, CMC’s Teng pointed out downside risks, such as Iranian exports and fears of a recession.
After reaching multi-year highs in March, oil prices have declined in the past three months on concerns that interest rate hikes and COVID-19 restrictions in China, the world’s top petroleum importer, may slow global economic development and chill oil demand.
Shenzhen’s lockdown was eased Monday after new infections stabilized, but the city remained on high alert.
An agreement might allow Iran to expand exports and improve world supply, but negotiations have dragged on.
The White House rejected linking the deal with the closure of U.N. nuclear watchdog probes on Friday, a day after Iran raised the matter....