Global oil prices rise after an OPEC report

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Global oil prices rise after an OPEC report

Today, Tuesday, global oil prices increased following a report by the Organization of the Petroleum Exporting Countries (OPEC) stating that market fundamentals remain strong. This comes amid concerns of possible supply disruption as the United States tightens its grip on Russian oil exports.

At 0113 GMT, Brent crude futures rose by 0.4% to $82.85 per barrel, while US West Texas Intermediate crude futures increased by 0.4% to $78.59 per barrel.

In its monthly report, OPEC blamed speculators for the latest price drop. It also slightly raised its forecast for global oil demand growth in 2023 and maintained its relatively high forecast for 2024.

Oil prices witnessed a significant drop last week, reaching their lowest point since July. This drop was attributed to concerns over a possible decline in demand from the United States and China, the world’s largest oil consumers. In October, China’s consumer price index reached a level unseen since the COVID-19 pandemic, and its exports contracted more than anticipated during that month.

The decline in sentiment prompted OPEC to reaffirm positive consumption outlook, ANZ Research noted on Tuesday.

The note stated that the market may face headwinds due to renewed talks to restart an oil pipeline in Iraq.

The Iraqi Oil Minister, Hayan Abdul Ghani, anticipates that he will soon come to an agreement with both the Kurdistan Regional Government and foreign oil companies. The agreement will enable the resumption of oil production from the region’s oil fields and the resumption of oil exports from the northern fields through the Iraqi-Turkish pipeline.

Turkey halted 450,000 bpd of northern exports through pipeline since March 25, following a ruling by the International Chamber of Commerce.

US crackdown on Russian oil exports could disrupt supplies, boosting prices.

The US Treasury Department has taken its largest step yet in reducing Moscow’s oil revenues by imposing a price ceiling and sending notices to ship management companies requesting information on 100 ships suspected of violating Western sanctions on Russian oil. The notices aim to gather information about the ships and their activities, which are suspected of contributing to the violation of sanctions.

In addition, the US Department of Energy plans to purchase 1.2 million barrels of oil to help replenish the Strategic Reserve after selling the largest amount ever of inventories last year.