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Tuesday, 07 July 2020
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The News and Media Division of The Insight Partners
Friday, 19 Jun 2020 07:00 pm

Oil tops $42 as OPEC+ laggards pledge better compliance

Oil rose to above $42 a barrel on Friday, adding to gains in the previous session, after OPEC producers and allies promised to meet supply cuts and signs of demand, hit by the coronavirus crisis, recovering.

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Iraq and Kazakhstan, during a meeting of an OPEC+ panel on Thursday, pledged to comply better with oil cuts, sources said. This means curbs by the Organization of Petroleum Exporting Countries and allies, known as OPEC+, could deepen in July.

“There is enthusiasm in the market that oil supply is still under control,” said Paola Rodriguez Masiu, analyst at Rystad Energy. “A positive OPEC+ meeting does that and yesterday’s session helped renew confidence.”

Brent crude LCOc1 was up 75 cents, or 1.8%, at $42.26 by 1117 GMT after hitting $42.89, its highest since June 8. U.S. West Texas Intermediate (WTI) crude CLc1 climbed 96 cents, or 2.5%, to $39.80.

“The key takeaway is that OPEC+ compliance will improve in the coming months,” said Stephen Brennock of broker PVM.

Both contracts rose about 2% on Thursday and are heading for weekly gains of more than 9%.

Brent has more than doubled since hitting a 21-year low in April, helped by record OPEC+ supply cuts of 9.7 million barrels per day (bpd), or 10% of world demand, and an easing of government lockdowns imposed to control the coronavirus.

Fuel demand in Europe is staging a gradual recovery after the height of the lockdowns in April but remains well below normal, data from several countries shows.

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Tags Oil price OPEC+ Iraq Coronavirus COVID-19 crisis Compliance

Neha Pandey

Aware of her elements, Neha writes the best articles across industries including electronics & semiconductors, automotive & transportation and food & beverages. Being from the finance background she has the ability to understand the dynamics of every industry and analyze the news updates to form insightful articles. Neha is an energetic person interested in music, travel, and entertainment. Since past 5 years, she written extensively on sectors like technology, finance and healthcare.


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