NYMEX crude oil is approaching a seven-year high again, OPEC+ accurately grasps the weakness of the United States

On Tuesday (October 5), international oil prices continued a new wave of gains triggered by the previous trading day. Earlier, the world’s major oil-producing countries announced their decision to maintain the current pace of increasing production. Crude oil-consuming countries feared that this would undermine the recovery from the epidemic.

GMT+8 15:45, NYMEX crude oil futures rose 0.36% to 77.91 US dollars/barrel; ICE Brent crude oil futures rose 0.55% to 81.70 US dollars/barrel. The two cities closed up 2.27% and 2.56% respectively overnight, and set a new high of US$78.38/barrel since November 10, 2014 and a new high of US$82/barrel since October 14, 2018.


The Organization of the Petroleum Exporting Countries and Russia's oil-producing allies (OPEC+) said on Monday (October 4) that they will stick to the existing agreement-increasing production by 400,000 barrels per day each month, ignoring the demands of major oil-consuming countries such as the United States and India to accelerate production. Call.

A senior aide to US President Biden discussed a series of issues during a meeting with Saudi Crown Prince Mohammed in Saudi Arabia last week, calling oil prices "worrying." India, another major oil consumer, is also struggling to demand an increase in oil supply.

Demand rebounded rapidly, and supply was disrupted by various factors, including the hurricane that severely damaged US production, and the low level of investment in the entire industry when demand fell sharply during the worst of the epidemic. Oil prices have soared by more than 50% this year, which has increased inflationary pressures.

Crude oil-consuming countries generally believe that the global economy has slowly recovered from the epidemic, and the prospects for oil demand are promising. However, sources in the oil-producing countries revealed shortly before the vote that despite the pressure to increase production, OPEC+ is concerned that the fourth wave of the global new crown epidemic may hit the demand recovery.

The organization agreed in July to increase production by 400,000 barrels per day at least until April 2022, in order to gradually end the current 5.8 million barrels per day production reduction plan. The current reduction in production has been much lower than the reduction in production during the worst period of the epidemic.

Russian Deputy Prime Minister Novak said after the meeting: "We will pay close attention to the situation. We know that demand usually declines in the fourth quarter. Our plan to increase (output) is progressing steadily. We will pay close attention to how the market will achieve it. balance."

Capital Investment Macro said: “We expect that the gradual normalization of demand growth and the rebound in supply will have an impact on oil prices from the fourth quarter. OPEC+ increases production and this dynamic will be reversed."

Avtar Sandu, Senior Commodity Manager of Phillip Futures in Singapore, said: "In the short term, the oil market may increase volatility... However, the main trend remains intact, and a deep correction will provide buying opportunities."