Oil Price Rise To $81 Per Barrel As OPEC+ Refuse To Raise Supply

After the much anticipated meeting of OPEC+ and its allies, The cartel refused to increase supply quantity to achieve market equilibrium, despite pressure from the United States. However, OPEC+ has stuck with the initial strategy to systematically increase output by 400,000 bpd.

Brent Crude rose by 0.65%, to $81.06 a barrel, by 12:00 GMT. U.S. West Texas Intermediate crude gained 0.81%, to $79.45.

The Organization of the Petroleum Exporting Countries during the meeting on Thursday validated  the plan to raise oil output by 400,000 barrels per day (bpd) from December 2021, ignoring agitation from U.S. President Joe Biden to boost production.

Saudi Arabia, A leading OPEC+ producer, vigorously dissolved outcry for faster oil production by the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, collectively known as OPEC+.

However, The U.S. government has vowed to use every mechanism at its disposal to suppress the market price of oil after OPEC’s meeting.

Analysts explain that the U.S. and other countries may disperse strategic petroleum reserves (SPR). The SPR may be able to fill the supply deficit  within a short period of time but will not be able to fix the structural issue of underinvestment and demand hike.

After oil prices have consistently reached staggering values, This week the U.S. increased supply through its oil inventories. As the United States oil expects a 5% decline, Brent Crude is also on track for a 4% decline this week.