The price of oil returns to the values of this morning after the announcement on the production of OPEC +. The WTI drops 0.5% stable at 93 dollars per barrel, while Brent loses 0.6% and costs 99 dollars per barrel.
For Noah Barrett, research analyst at Janus Henderson, “today’s OPEC + meeting was pretty quick, with a result that should be supportive of oil prices. OPEC + has decided to increase production by 100,000 barrels per day (kb / d) in September, an increase that will be shared among member countries. Given that some countries are currently producing less than their allocated quotas, this means that they may not be able to meet their share to lead to growth of 100kb / from September. So, even if officially the increase will be the one indicated, the actual increase in supply could be lower. The US was likely hoping for a greater increase in production, especially after Biden’s recent trip to the Middle East. In terms of overall supply and demand management, OPEC’s decision is logical. There is still a lot of uncertainty about oil demand in the second half of this year, due to questions about Chinese demand and the possibility of a recession in the US or even globally.
Furthermore, the storage capacity remains limited; OPEC’s press release classified the availability of storage capacity as “severely limited,” which also limits OPEC’s ability to bring a material increase in supply to the market. “