Texas Intermediate Oil (WTI) price closed up 0.11% this Tuesday at $86.88 a barrel, a day after the OPEC+ alliance decided to withdraw 100,000 barrels a day from the market, which it said would add a month. had decided. before
At the end of trading on the New York Mercantile Exchange (Nymex), WTI futures contracts for October delivery were up 1 percent from the previous close.
OPEC and its allies’ decision marks the first supply cuts it has agreed to in more than a year, and comes at a time of rising tensions in the energy market due to Russia’s invasion of Ukraine.
By October 1, the group of 23 countries will reduce their production on fears that a slowdown in the world economy will reduce demand for black gold.
With this decision, the increase in pumping, adopted by OPEC+ region ministers in their monthly teleconference, was canceled at the previous meeting, on 3 August, for September.
The small boost was widely interpreted as a rebuke to US President Joe Biden after visiting Saudi Arabia to ask the OPEC leader to cool prices and help the global economy.
Following the decision by the Saudi Arabian and Russian-led oil conglomerate, the US government insisted yesterday that it will continue to do what is necessary to reduce energy prices.
“President Biden remains committed to taking all necessary steps to increase energy supplies and reduce prices,” the White House said in a statement yesterday.
“US oil production has increased by more than half a million barrels a day since the beginning of the year and is on track to reach more than a million by the end of the year,” the note released yesterday by the Biden administration said.
Investors are also concerned about the impact of the latest COVID-19 restrictions in China.
On the other hand, inflation is in the double-digit region in many of the world’s largest economies, so many central banks are raising interest rates more aggressively, which could translate into a wider recession and hit fuel demand.
October natural gas futures contracts fell 64 cents to $8.14, and gasoline futures fell 4 cents to $2.41 a gallon in the same month.