Brent crude prices close above $80/barrel as OPEC+ clings to February output hike

• Financial

On Tuesday, both Brent and US WTI (West Texas Intermediate) crude oil futures almost bounced back to a November peak, when Omicron worries had sent shockwaves across global commodity markets, as the Saudi-led 14-member OPEC (Organization of Petroleum Exporting Countries) alongside its Russia-backed allies, often called as OPEC+, had agreed to cling on to their previous decision to hike output as early as by February, mostly driven by anticipation that the omicron variant would have a much-lower than anticipated impact on global demand.

On top of that, corroborating crude oil futures’ prices further, analysts had projected that US crude stockpiles would falter for a sixth straight week on a row, though a US State Department remark that talks with Tehran on reviving a 2015 nuclear deal had shown modest progress, had pared some of the gains.

Nevertheless, in the day’s lofty gains in crude oil futures’ prices were almost entirely catapulted by an OPEC+ decision to hang on to their slated output hike of 400,000 bpd (barrels per day) by February, as latest OPEC+ move had eased investors’ concern that the first quarter of 2021 would likely to witness a giant leapfrog in surpluses.

Adding further impetus, analysts were quoted saying that Libyan oil output would likely to experience a decrease by 500,000 bpd to 600,000 bpd over upcoming weeks.

Brent crude claws back above $80/barrel

Citing statistics, in the day’s commodity market wind-down, UK crude futures’ edged 1.3 per cent higher to $80 per barrel, while US WTI crude oil contracts gained 1.2 per cent to $76.99 a barrel.

Meanwhile, addressing to the day’s OPEC+ meet, Rystad Energy head of oil markets, Bjornar Tonhaugen said, “The oil market is bullish today as a result of optimism sourced from today's monthly OPEC+ meeting, which is helping oil prices trade higher”.