Brent unmoved by OPEC+ supply hike
The front-month ICE Brent contract has remained unchanged on the day from Friday, to trade at $64.66/bbl at 09.00 GMT.
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Upward pressure:
Brent crude’s price has felt some upward pressure after official drilling figures showed a decrease in US oil rigs.
The total number of oil rigs fell by six over the week to 414, according to Baker Hughes.
The US oil rig count is seen as an indicator of future oil production. It reflects how much oil drilling activity is happening or expected to happen in the shale sector.
“The broader weakness in oil prices continues to weigh on drilling activity in the US,” two analysts from ING Bank noted.
Downward pressure:
OPEC+ has decided to continue with production hikes until the end of this year. This news has capped Brent’s price rise today.
Eight members of the group have agreed to collectively increase their production by another 137,000 b/d in December.
This marks the group's eighth consecutive plan to boost production. The move was “widely expected,” according to ING Bank’s analysts.
In an oversupplied market, any signal of increased future supply can put downward pressure on Brent’s price.
By Aparupa Mazumder
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