Latest news with #JorgeLeon
International Business Times
20 hours ago
- Business
- International Business Times
Oil Prices Surge 4% After OPEC+ Maintains July Output Hike
Oil prices surged Monday in the wake of the OPEC+ decision to stick to its scheduled increase in production next month. Brent crude was up $2.28, or 3.6%, at $65.06 a barrel by 1335 GMT. U.S. West Texas Intermediate (WTI) crude also rose by $2.99, or 4.9%, to $63.78 a barrel. The price surge follows declines of more than 1% for both benchmarks last week. OPEC+, the coalition of oil producers comprised of Saudi Arabia and Russia, said on Saturday that it would increase production by 411,000 barrels a day (bpd) in July. This is the third straight month of such gains. The group is hoping to win back market share and punish members that have pumped more than their quotas. Although there was speculation last week that a bigger output increase might be in play, the group stuck with the expected increase. The 411,000 bpd figure was already priced by traders, and analysts say a surprise bigger increase could have sent prices scurrying south. "If they had delivered a larger surprise, surprise, then the price open on Monday would have been pretty ugly," said Harry Tchilinguirian of Onyx Capital Group. The move arrives on the heels of indications of internal problems. Kazakhstan, for one country, has declined to reduce output, despite its earlier promise. Kazakhstan was not going to adhere to production cuts, Russia's Interfax news agency reported yesterday that the country's deputy energy minister had said. Analysts say oil prices would have to drop below $58 a barrel to make Kazakhstan's overproduction a losing proposition. OPEC+ will confirm another 410,000 bpd increase for August, according to Goldman Sachs, which said fundamental support is returning. "Tight spot oil fundamentals, beats in hard global activity data, and seasonal summer support to oil demand mean that the expected demand slowdown is unlikely to be sharp enough to change our view that we will keep raising production," the bank said. Morgan Stanley shares this view, predicting that the coalition will roll out more incremental increases each month all the way to October, when 2.2 million b/d is replaced. Political risks are similarly factored into oil prices. Ukrainian drone attacks on Russian targets over the weekend have increased tensions, which energy analysts say is adding to the price support. "We are back to geopolitical risks," said Jorge Leon of Rystad Energy. By and large, the mood is cautious. World oil demand is forecast to rise by some 775,000 bpd in 2025, according to the International Energy Agency's most recent forecast for a lesser gain of 740,000 bpd. For their part, the contrary numbers are increasing only slightly and may be too modest to offset greater supply.
Express Tribune
3 days ago
- Business
- Express Tribune
OPEC+ oil producers plan big hike
While the Omicron coronavirus variant is rapidly taking hold, demand-side concerns are easing amid rising evidence that it is less severe than previous variants.. PHOTO: REUTERS Listen to article The world's largest group of oil producers, OPEC+, stuck to its guns on Saturday with another big increase of 411,000 barrels per day for July as it looks to wrestle back market share and punish over-producers. Having spent years curbing production – more than 5 million barrels a day (bpd) or 5% of world demand – eight OPEC+ countries made a modest output increase in April before tripling it for May, June and now July. They are spurring production despite the extra supply weighing on crude prices as group leaders Saudi Arabia and Russia seek to win back market share as well as punish over-producing allies such as Iraq and Kazakhstan. The eight countries held an online meeting on Saturday to set July production. They also discussed other options, an OPEC+ delegate said. On Friday, sources familiar with OPEC+ talks had said they could discuss an even larger hike. In a statement OPEC+ cited a "steady global economic outlook and current healthy market fundamentals, as reflected in the low oil inventories" as its reasoning for the July increase. Its increased supply is weighing on crude prices, squeezing all producers, but some more than others, including a key group of rivals – US shale producers, analysts say. "Three strikes from OPEC+, and none were softballs. May warned, June confirmed, and July fires a shot across the bow," said Jorge Leon, head of geopolitical analysis at Rystad and a former OPEC official. Since April, the OPEC+ eight have now made or announced increases totalling 1.37 million bpd, or 62% of the 2.2 million bpd they aim to add back to the market. Higher summer oil demand favours increasing output at this time, OPEC+ officials including Russian Deputy Prime Minister Alexander Novak have said. Algeria was among a small number of nations that requested a pause in the output hikes on Saturday.
Qatar Tribune
3 days ago
- Business
- Qatar Tribune
OPEC+ announces sharp increase in July oil production
Agencies Vienna Saudi Arabia, Russia and six other key OPEC+ members announced on Saturday a huge increase in crude production for July. They will produce an additional 411,000 barrels a day -- the same target set for May and then June -- according to a statement, which is more than three times greater than the group had previously planned. In recent years the 22-nation group had agreed to daily reductions of 2.2 million barrels with the aim of boosting prices. But in early 2025, leading members of the group known as the 'Voluntary Eight', or V8, decided on the gradual output increase and subsequently began to accelerate the pace. The moves have resulted in oil prices plummeting to around $60 per barrel, the lowest level in four years. OPEC+ 'struck three times: (the output target for) May was a warning, June a confirmation and July a warning shot', Rystad Energy analyst Jorge Leon told a news agency. 'The scale of the production increase reflects more than just internal supply dynamics,' he said. 'This is a strategic adjustment with geopolitical aims: Saudi Arabia seems to be bowing to Donald Trump's requests.' Shortly after taking office, the US president called on Riyadh to ramp up production in order to bring down oil prices, meaning cheaper prices at the pump for Americanconsumers. Saturday's decision comes after a meeting of all OPEC ministers on Wednesday, where the alliance's collective production policy was reaffirmed. The decision is officially justified by 'healthy market fundamentals' covering oil reserves and structural demand growth during coming months. But markets have met this view with scepticism amid concerns about demand and a trade war launched by the United States. Analysts see several possible motivations for the production hikes, one of them being Saudi Arabia and others penalising members for not keeping to their quotas under the cuts first agreed in 2022. The increase is all the more likely due to 'the latest statements of Kazakh Energy Minister Yerlan Akkenzhenov, who has apparently already informed OPEC that his country will not reduce production,' said Thu Lan Nguyen, an analyst at Commerzbank. 'Saudi Arabia is angry with Kazakhstan', which is seen as one of the main laggards, and which 'produced 300,000 barrels per day more than its quota,' said Bjarne Schieldrop, an analyst at SEB. Analysts meanwhile do not foresee a plunge in oil prices when markets open Monday as the announcement was largely anticipated, instead resulting in a 'moderate' reaction. On Friday, the benchmark Brent crude futures price had settled at $62.61 per barrel, while West Texas Intermediate was at $60.79.
IOL News
3 days ago
- Business
- IOL News
OPEC+ announces sharp increase in July oil production
Saudi Arabia, Russia and six other key OPEC+ members announced on Saturday a huge increase in crude production for July. They will produce an additional 411 000 barrels a day - the same target set for May and then June - according to a statement, which is more than three times greater than the group had previously planned. In recent years the 22-nation group had agreed to daily reductions of 2.2 million barrels with the aim of boosting prices. But in early 2025, leading members of the group known as the "Voluntary Eight", or V8, decided on the gradual output increase and subsequently began to accelerate the pace. The moves have resulted in oil prices plummeting to around $60 per barrel, the lowest level in four years. OPEC+ "struck three times: (the output target for) May was a warning, June a confirmation and July a warning shot", Rystad Energy analyst Jorge Leon said. "The scale of the production increase reflects more than just internal supply dynamics," he said. "This is a strategic adjustment with geopolitical aims: Saudi Arabia seems to be bowing to Donald Trump's requests." Shortly after taking office, the US president called on Riyadh to ramp up production in order to bring down oil prices, meaning cheaper prices at the pump for American consumers. Saturday's decision comes after a meeting of all OPEC ministers on Wednesday, where the alliance's collective production policy was reaffirmed. The decision is officially justified by "healthy market fundamentals" covering oil reserves and structural demand growth during coming months. AFP
New Indian Express
3 days ago
- Business
- New Indian Express
OPEC+ to hike July oil production after Trump urges Saudi to increase output
VIENNA: Saudi Arabia, Russia and six other key OPEC+ members announced on Saturday a huge increase in crude production for July. They will produce an additional 411,000 barrels a day -- the same target set for May and then June -- according to a statement, which is more than three times greater than the group had previously planned. In recent years the 22-nation group had agreed to daily reductions of 2.2 million barrels with the aim of boosting prices. But in early 2025, leading members of the group known as the "Voluntary Eight", or V8, decided on the gradual output increase and subsequently began to accelerate the pace. The moves have resulted in oil prices plummeting to around $60 per barrel, the lowest level in four years. Trump pressure OPEC+ "struck three times: (the output target for) May was a warning, June a confirmation and July a warning shot", Rystad Energy analyst Jorge Leon told AFP. "The scale of the production increase reflects more than just internal supply dynamics," he said. "This is a strategic adjustment with geopolitical aims: Saudi Arabia seems to be bowing to Donald Trump's requests." Shortly after taking office, the US president called on Riyadh to ramp up production in order to bring down oil prices, meaning cheaper prices at the pump for American consumers. Saturday's decision comes after a meeting of all OPEC ministers on Wednesday, where the alliance's collective production policy was reaffirmed. The decision is officially justified by "healthy market fundamentals" covering oil reserves and structural demand growth during coming months. Riyadh 'angry' But markets have met this view with scepticism amid concerns about demand and a trade war launched by the United States. Analysts see several possible motivations for the production hikes, one of them being Saudi Arabia and others penalising members for not keeping to their quotas under the cuts first agreed in 2022. The increase is all the more likely due to "the latest statements of Kazakh Energy Minister Yerlan Akkenzhenov, who has apparently already informed OPEC that his country will not reduce production," said Thu Lan Nguyen, an analyst at Commerzbank. "Saudi Arabia is angry with Kazakhstan", which is seen as one of the main laggards, and which "produced 300,000 barrels per day more than its quota," said Bjarne Schieldrop, an analyst at SEB. Analysts meanwhile do not foresee a plunge in oil prices when markets open Monday as the announcement was largely anticipated, instead resulting in a "moderate" reaction. On Friday, the benchmark Brent crude futures price had settled at $62.61 per barrel, while West Texas Intermediate was at $60.79.
