Crude oil pares weekly loss as Opec+ says it can cancel supply hike

By Yongchang Chin and Grant Smith

Oil futures pared a weekly loss after some members of Opec+ signaled that a plan to revive halted supplies may yet be canceled. 
 

Brent crude futures were trading near $80 a barrel, rebounding from the four-month low struck on Monday after Saudi Arabia and its partners outlined planes to gradually resume production. Saudi Energy Minister Prince Abdulaziz bin Salman led ministers on Thursday in reiterating that the hike is contingent on market conditions. 

“Opec+ members set about a charm offensive yesterday with the big guns of the pact deployed in a show of unison,” said John Evans, an analyst at brokers PVM Oil Associates Ltd. The “intervention showed decent success as it was very well timed.”

 

The plan has drawn a mixed reaction from Wall Street. JPMorgan Chase & Co. expressed doubt over its bearish effect because many members are already pumping above their assigned quotas, while Citigroup Inc. predicts full cuts will be maintained into next year.

Oil has trended lower since early April in part due to concerns over the demand outlook. However, geopolitical risks surrounding the war in Ukraine and the Middle East continue to simmer, which could spur further price gains.