Home / Markets / Commodities /  Brent above $95/bbl on OPEC’s supply cut decision

New Delhi: International crude oil prices extended gains on Friday post the decision of OPEC+ to cut production starting November.

Around 4.30 pm, the December contract of Brent on the Intercontinental Exchange was at $95.48 per dollar, higher by 1.12% from its previous close. The November contract of West Texas Intermediate (WTI) rose 1.20% to $89.51 a barrel.

“Oil prices extended gains as oil producers agreed to tighten global supply with a deal to cut output targets. We believe that the price impact of the measures will be substantial, and prices could continue its upward trajectory with Brent breaking $100 per barrel very soon," said Sriram Iyer, senior research analyst at Reliance Securities.

“However, expectations of release of oil inventories from SPR’s from the U.S. could cap gains," he said.

Earlier this week, the Organization of the Petroleum Exporting Countries (OPEC) and other major oil producing countries agreed to cut production by 2 million barrels per day (bpd), the biggest output cut since the start of the pandemic.

OPEC noted that decision has been taken in light of the uncertainty that surrounds the global economic and oil market outlooks, and the need to enhance the long-term guidance for the oil market. Since June, international oil prices largely declined amid concerns of a global recession and interest rate hikes by central banks.

According to analysts, crude prices are likely to reach $100 per barrel going ahead.

Despite the volatility in the market, retail fuel prices remained unchanged in India. In the national capital, petrol is sold at 96.72 per litre and diesel is priced at 89.62 per litre.

Experts are of the view that despite the output and its likely impact going ahead, retail fuel prices are unlikely to be revised in the near term.

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