The Economic Times
English EditionEnglish Editionहिन्दीગુજરાતી
| E-Paper
Search
+

    Crude oil prices rise nearly 3% ahead of Opec+ meeting, easing lockdowns

    Synopsis

    US West Texas Intermediate crude (WTI) climbed 2.5 per cent, or 87 cents, to $36.31 a barrel.

    Getty Images
    Brent crude rose 2.7 per cent, or $1.04, to $39.36 a barrel by 11:37 a.m. EDT (1537 GMT).

    Commodity Summary

    MCX
    NEW YORK: Oil prices were up about $1 a barrel on Tuesday on expectations that major producers will agree to extend output cuts during a video conference likely to be held this week and as countries and US states begin to restart after coronavirus lockdowns.

    Brent crude rose 2.7 per cent, or $1.04, to $39.36 a barrel by 11:37 a.m. EDT (1537 GMT).

    US West Texas Intermediate crude (WTI) climbed 2.5 per cent, or 87 cents, to $36.31 a barrel.

    The Organization of the Petroleum Exporting Countries and others including Russia, a grouping known as OPEC+, are considering extending their production cuts of 9.7 million barrels per day (bpd), or about 10 per cent of global production, into July or August, at a meeting expected to be held on June 4.

    "Most likely, OPEC+ could extend current cuts until Sept. 1, with a meeting set before then to decide on next steps," said Citi's head of commodities research Edward Morse.

    Under the original OPEC+ plan, the cuts were due to run through May and June, scaling back to a reduction of 7.7 million bpd from July to December.

    Saudi Arabia has been pushing to keep the deeper cuts in place for longer, sources said.

    The gradual reopening of businesses in a growing number of US states and countries around the world after shelter-in-place mandates caused by the coronavirus pandemic also oil boosted prices.

    "As the economy opens up, there's more and more people on the road. That's going to be good, obviously, for crude oil," said Bob Yawger, director of energy futures at Mizuho in New York.

    Steadily increasing gasoline demand in the United States and falling crude inventories at the nation's oil storage hub in Cushing, Oklahoma, has also supported prices, Yawger said.

    Industry group American Petroleum Institute will release its weekly oil inventory report later in the day, with official data following on Wednesday.
    (What's moving Sensex and Nifty Track latest market news, stock tips and expert advice on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds.)

    Also Read

    The Economic Times