Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Oil Rebounds as White House, OPEC Both Brace for Fight

CommoditiesNov 23, 2021 04:02
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.

By Barani Krishnan

Investing.com - The global fight over oil prices is coming down to the wire with both the White House and OPEC+ signaling determination to get the market to where they want with the crude supplies that they have in hand.

Crude rebounded from eight-week lows on Monday after an OPEC+ delegate was quoted saying that the global oil producing alliance might adjust its production plans if consuming countries released their reserves to get more supply on the market in order to push prices lower. 

OPEC+, which is still withholding some 5.0 million barrels of regular daily supply from the market as part of production cuts carried out at the height of the demand-busting Covid-19 pandemic, has said it will add 400,000 barrels per day to the market — not more. The threat to “adjust” production basically means doing away with even that increase. 

Crude prices rose steadily on the OPEC+ threat. But the market’s upside was, however, limited by a Bloomberg report that the United States was preparing an oil sale from its reserves over the next 24 hours, and that the move will be in collaboration with other consuming nations.

“The United States is preparing to release oil from its Strategic Petroleum Reserve as soon as Tuesday, in concert with other consuming nations,”  the Bloomberg report said, citing sources familiar with the matter.

“The situation remains in flux and the plans could change but the U.S. is considering a release of more than 35 million barrels over time, according to one of the people,” the report added.

President Joe Biden, the central architect of the consumer fightback against high oil prices created by OPEC+ production cuts, did not speak about any SPR releases when he addressed a White House news conference on Monday.

But the market was abuzz with speculation that the fight was on, and that both sides were going to take the battle right down to the wire.

“The number reported for the White House SPR release by Bloomberg seems decent and could help depress prices, especially if the new Covid onslaught seen in Europe continues,” said John Kilduff, founding partner at New York energy hedge Again Capital. 

“OPEC+ of course has already prepared its response and could put that into action if WTI gets below $70.”

WTI, or the West Texas Intermediate benchmark for U.S. crude, settled up 81 cents, or 1.05%, at $76.75 per barrel, after hitting an eight-week low of $74.76. Over the past four weeks, WTI had lost  9%, bringing to an end a prior 9-week rally that delivered a gain of 18%. Before its most recent sell-off, the U.S. benchmark traded at a seven-year high of $85.41 in mid-October. It also remains up 58% on the year.

London-traded Brent crude, the global benchmark for oil, also settled up 81 cents, or 1.03%, at $79.70 per barrel. 

Brent lost 8% over the past four weeks, after an 18% rally over seven weeks in a row. Just in mid-October, it hit a seven-year high of $86.70. Despite the slump of the past four weeks, it remains up 53% on the year.

Oil Rebounds as White House, OPEC Both Brace for Fight
 

Related Articles

Energy Precious Metals - Weekly Review and Outlook
Energy Precious Metals - Weekly Review and Outlook By Investing.com - Jan 16, 2022

By Barani Krishnan Investing.com -- How do we know when irrational exuberance has unduly escalated asset values, which then become subject to unexpected and prolonged...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email