OPEC output cut extension positive for oil prices near-term, UBS says

Investing.com -- The decision by OPEC+ to extend its production cuts through December is seen by UBS analysts as a modest but positive step for oil prices in the short term. 

This extension maintains a cut of 2.2 million barrels per day (Mb/d), an agreement initially struck last year. 

UBS noted that while this action aligns with their expectations, market speculations about a potential production increase had raised concerns prior to the announcement, making the continuity of cuts a reassuring factor for price stability​.

UBS outlines that OPEC+ remains cautious about reintroducing additional barrels into the market, particularly as demand typically softens seasonally at this time of year. 

A sudden increase in production from Libya had already somewhat alleviated supply constraints, further justifying the extended restraint by OPEC+. 

This approach reflects a prudent stance from OPEC+ amid mixed compliance on compensation requirements from members like Iraq, Kazakhstan, and Russia who had exceeded previous production targets.

Looking beyond December, UBS anticipates that apprehensions regarding potential output increases will persist, with the group scheduled to review policy in early December. 

A more substantial production ramp-up is currently slated for 2025, at which point OPEC+ will likely reassess market conditions and U.S. policy implications, though UBS maintains that sluggish demand growth and stable output from non-OPEC sources could still discourage any major increases. 

“We see the market just about balanced next year with no unwind of the production cuts, which keeps Brent at an average $75/bbl in 2025 in our base case,” the analysts said.

Source: Investing.com

Последние публикации
Oil prices settle up 1% at 2-week high as Ukraine war intensifies
22.11.2024 - 22:00
COP29 climate summit overruns as $250 billion draft deal stalls
22.11.2024 - 21:00
Oil prices climb 1% to two-week high as Ukraine war intensifies
22.11.2024 - 20:00
Oil prices edge up to 2-week high as Ukraine war intensifies
22.11.2024 - 19:00
COP29 climate summit overruns as $250 billion draft deal flops
22.11.2024 - 17:00
Indian opposition parties deny any wrongdoing linked to Adani bribery allegations
22.11.2024 - 17:00
Oil prices head for weekly gain on Russia-Ukraine tensions
22.11.2024 - 16:00
Goldman sees upside risks for Brent near term
22.11.2024 - 15:00
COP29 climate summit draft proposes rich countries pay $250 billion per year
22.11.2024 - 14:00
US Treasury investigates JPMorgan's client ties to Iranian figure - Bloomberg
22.11.2024 - 14:00
Morning Bid: Euro/dollar stares at parity, Bitcoin eyes $100k
22.11.2024 - 13:00
COP29 climate finance draft proposes $250 billion target from wealthy countries
22.11.2024 - 13:00
Oil heads for weekly gains as Ukraine war intensifies
22.11.2024 - 12:00
COP29 host urges collaboration as deal negotiations enter final stage
22.11.2024 - 10:00
Gold prices rise, set for strong weekly gains on Russia-Ukraine jitters
22.11.2024 - 08:00

© Analytic DC. All Rights Reserved.

new
Анализ рынка Как повлият завтра отчет NFP на курс доллара США?