Oil prices rise 2% ahead of OPEC+ summit

The Brent October on the Intercontinental Exchange was trading at $95.54 at 14:15 IST, an increase of 2.71% from its previous close. The price of a barrel of West Texas Intermediate on the NYMEX increased 2.56% to $89.09.

Prior to the meeting of “Opec+,” the coalition of the Organization of the Petroleum Exporting Countries (Opec) and other major oil producing countries, crude oil prices globally increased by more than 2% on Monday.

The Brent October on the Intercontinental Exchange was trading at $95.54 at 14:15 IST, an increase of 2.71% from its previous close. The price of a barrel of West Texas Intermediate on the NYMEX increased 2.56% to $89.09.

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Ravindra Rao, head of commodity research at Kotak Securities, said crude prices rose “as market players position for Opec+ production policy meeting today…There has been a lot of chatter about OPEC’s production cut, however, the oil producer group is largely expected to keep productions steady today. Crude is also supported by concerns about Russian supply as G7 countries agreed to impose a price cap on Russian oil however major buyers India and China are not likely to join.”

He added that demand concerns, given China’s covid-related restrictions, weighed on prices.

According to Sriram Iyer, a senior research analyst at Reliance Securities clarity on the potential nuclear deal has yet to surface, and this has made some investors doubt that a deal was near, supporting oil prices.

“We expect crude oil prices to remain volatile as traders are looking forward to today’s meeting of the OPEC+, which is likely to discuss output cuts,” said Rahul Kalantri, vice president for commodities with Mehta Equities.

Domestic retail prices for gasoline and diesel, meanwhile, have not moved in recent days. On Monday, gasoline cost 96.72 rupees a litre in the national capital while diesel cost 89.62.