Business Latest

Oil prices rise after OPEC+ approves output deal, Bonny Light adds $0.20

Oil prices rise as OPEC, allies agree deal to cut output by 10m barrels/day

Oil prices advanced by nearly 2% on Friday, approaching a fifth successive week of gains, with key producers consenting on a compromise to extend some cuts to supply in a bid to adapt to a demand weakened by COVID-19.

Brent, the benchmark for Nigerian crude grades, climbed by 93 cents or 1.9% to $49.64 per barrel by 08:48 West African Time, having risen by roughly 1% at the previous session. West Texas Intermediate gained 76 cents or 1.6%, trading at $46.40 after jumping by almost 1% on Thursday.

Bonny Light, Nigeria’s banner oil grade, appreciated by $0.20 or 0.41% on Thursday, closing at $48.68 as the oil prices of most crude grades gained across oil markets.

Qua Iboe, another major national crude grade, climbed $1.44 or 3.03% to $48.96 in early trading on Friday.

OPEC and Russia agreed on Thursday to reduce profound oil supply cut from January by 500,000 barrels per day (bpd) but could not agree on a wider policy for remainder of 2021.

Goldman Sachs said “OPEC+ clearing the hurdle of exiting its current cuts in a coordinated way … reinforces our conviction in a steady and sustainable rally in oil prices through 2021.”

Read also: Oil prices drop as OPEC+ resumes supply cut talks, Bonny Light gains $1.01

The rise implies the Organisation of the Petroleum Exporting Countries (OPEC) and Russia, a cartel called OPEC+, are on track to pare down output by 7.2 million bpd or 7% of the world demand from January, compared to current cut level of 7.7 million bpd.

OPEC+ was anticipated to retain current cuts until March at least, following its withdrawal from plans to increase supply by 2 million bpd, a move expected to bolster oil prices.

Oil prices also drew strength from a bipartisan COVID-19 $908 billion, which gained momentum in the U.S. Congress on Thursday.

Join the conversation

Opinions

About the author

Ripples Nigeria

We are an online newspaper, very passionate about Nigerian politics, business and their leaders. We dig deeper, without borders and without fears.
www.ripplesnigeria.com

/* ]]> */