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Oil Prices in 6-Week Rally as OPEC+ Dillydally Stokes Hope for Cautious Hike

imageCommodities45 minutes ago (Jul 02, 2021 03:05PM ET)

(C) Reuters.

By Yasin Ebrahim

Investing.com – Crude oil prices notched a sixth-weekly win Friday despite a sluggish end to the week as major oil producers attempt to reach a consensus on plans to ease production curbs.

On the New York Mercantile Exchange crude futures rose 7 cents to $75.16 a barrel, while on London’s Intercontinental Exchange (NYSE:ICE), Brent added 0.70% to $76.37 a barrel.

The Organization of the Petroleum Exporting Countries and allies, or OPEC+, got their meeting underway Friday, to reach a breakthrough on how much to lift output.

OPEC+ was forced to delay its meeting until Friday after the United Arab Emirates blocked a plan a preliminary agreement to reportedly raise output by 400,000 barrels per day from August to December.

The squabble of how much to raise output has increased expectations for the cautious production hike.

“The OPEC+ meeting delay provides some insight on the continued fragility of oil market fundamentals. This could result in OPEC+ cautiously increasing supply, which is a positive for oil markets while demand rebounds toward pre-pandemic levels,” RBC said in a note.

On the demand side, meanwhile, the optimism over a recovery shows little sign of fading despite the threat posed by the delta variant of Covid-19 on international travel.

Earlier this week, OPEC Secretary General Mohammad Barkindo, forecast demand to rise by 6 million barrels per day in 2021, the bulk of which, about 5 million barrels per day, is expected in the second half of the year.

Oil Prices in 6-Week Rally as OPEC+ Dillydally Stokes Hope for Cautious Hike

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