- crude oil futures rise on fears of tightening supply after OPEC+ cancels meeting
- oil demand expected to rise as countries around the world emerge from pandemic-related lockdown
Crude oil futures rise on fear of tightening supply after OPEC+ cancels a meeting, says an article on S&P Global.
Fears of tightening supply
Crude oil futures extended overnight gains during mid-morning trade in Asia July 6 on fears that oil demand will soon outstrip supply after the OPEC+ coalition, consisting of OPEC members and other oil producers, canceled its July 5 meeting without ratifying an increase in production for August onward.
The rise in the international oil markers come after OPEC+ called off their July 5 meeting, which was to mark the third day of official talks, necessitated by the coalition’s failure to reach an agreement to ease production cuts from August onwards.
To boost collective crude output
The producer group has reached a tentative agreement to boost collective crude output by 400,000 b/d each month from August to December, but Saudi Arabia wanted to tie the production increases to lengthening the supply management pact through the end of 2022 from the current April 2022 expiry.
The UAE, however, refused to sign off on the extension, insisting that its baseline production level from which its quota is determined to be raised first.
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Source: S&P Global
