Oil Prices Rise as OPEC+ Postpones Production Cut Rollback, But Future Stability Remains Uncertain
Crude oil prices surged over $1 per barrel following OPEC+’s decision to postpone a planned partial rollback of production cuts, which would have reinstated 180,000 barrels per day starting in December. The group emphasized that any supply increase was contingent on favorable price conditions, which have not materialized. As a result, Brent crude traded at $74.37 per barrel, and West Texas Intermediate was at $70.75 per barrel.
Analysts from ING noted that although the delay in supply adjustments does not significantly alter market fundamentals, it signals a shift in OPEC+’s strategy, suggesting a stronger commitment to supporting prices than previously thought.
Reports indicate Saudi Arabia’s dissatisfaction with lost market share from the existing cuts has influenced this decision.
However, analysts expressed caution regarding the longevity of the price increase, predicting significant resistance around the $78 per barrel mark, while also asserting that the market may remain in surplus through 2025 unless OPEC+ maintains production cuts into the following year. [1]
