Skip to main content
Tags: OPEC | oil and gas | energy prices | inflation

Oil Hits Multi-Year High on OPEC+ Restraint

oil rig
 An oil drilling rig in the Santa Barbara Channel offshore Goleta, Calif. (AP)

Wednesday, 06 October 2021 07:27 AM EDT

Oil hit a multi-year high on Wednesday above $83 a barrel, supported by OPEC+'s refusal to ramp up production more rapidly against a backdrop of concern about tight energy supply globally.

The market later unwound those gains due to an American Petroleum Institute (API) report showing rising crude inventories in the United States and, analysts said, technical indicators suggesting oil has rallied too fast.

On Monday, the Organization of the Petroleum Exporting Countries and allies, known as OPEC+, chose to stay with a plan to increase output gradually and not boost it further as the U.S. and other consumer nations have been urging.

Brent crude rose as high as $83.47, the highest since October 2018, and at 1115 GMT was down 40 cents, or 0.5%, at $82.16. U.S. crude climbed to $79.78, the highest since November 2014, and was later down 35 cents at $78.58.

"An energy crisis is unfolding with winter in the northern hemisphere still to begin, and sets the stage for even higher oil prices," said Stephen Brennock of oil broker PVM.

The price of Brent has surged more than 50% this year, adding to inflationary pressure that could slow recovery from the COVID-19 pandemic. Natural gas has surged to a record peak in Europe and coal prices from major exporters have also hit all-time highs.

Jeffrey Halley, analyst at brokerage OANDA, said both crude contracts looked overbought based on a widely followed technical indicator, the relative strength index.

"That may signal some daily pullbacks this week but does not change the underlying bullish case for oil," he said.

Some downward pressure came from the API's figures showing signs of slowing fuel demand.

The industry group said U.S. crude inventories rose by 951,000 barrels in the week to Oct. 1, website Oilprice.com reported, and gasoline and distillate fuel inventories also climbed.

Attention will focus later on official inventory numbers due at 1430 GMT from the Energy Information Administration.

© 2024 Thomson/Reuters. All rights reserved.


StreetTalk
Oil hit a multi-year high on Wednesday above $83 a barrel, supported by OPEC+'s refusal to ramp up production more rapidly against a backdrop of concern about tight energy supply globally.
OPEC, oil and gas, energy prices, inflation
321
2021-27-06
Wednesday, 06 October 2021 07:27 AM
Newsmax Media, Inc.

Sign up for Newsmax’s Daily Newsletter

Receive breaking news and original analysis - sent right to your inbox.

(Optional for Local News)
Privacy: We never share your email address.
Join the Newsmax Community
Read and Post Comments
Please review Community Guidelines before posting a comment.
 
TOP

Interest-Based Advertising | Do not sell or share my personal information

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
America's News Page
© Newsmax Media, Inc.
All Rights Reserved
Download the NewsmaxTV App
Get the NewsmaxTV App for iOS Get the NewsmaxTV App for Android Scan QR code to get the NewsmaxTV App
NEWSMAX.COM
America's News Page
© Newsmax Media, Inc.
All Rights Reserved