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Oil prices rose today by more than 1%, to continue the gains made in the previous session after OPEC and its allies agreed not to increase supplies in April as they await a greater recovery in demand in light of the Coronavirus pandemic.
Brent crude futures for May delivery increased by more than a dollar to $67.77 a barrel during Asian trading and is on a path of gaining about 2% for the week.
US West Texas Intermediate crude futures rose more than a dollar to 64.87 dollars.
The two benchmarks rose more than 4% on Thursday after the Organization of the Petroleum Exporting Countries (OPEC) and allies, a group known as OPEC+, extended oil production cuts to April and made limited exceptions to Russia and Kazakhstan.
“It just shows the surprise in the discipline of OPEC +,” said Michael McCarthy, chief market strategist at CMC Markets.
Investors were surprised that Saudi Arabia decided to maintain its voluntary reduction of one million barrels per day in April, even after oil prices rose over the past two months.
Crude prices have risen since the beginning of November, but the current demand for oil from refiners and other consumers has not yet matched that, as shipments to major markets such as China are traded in general at lower prices in light of the slowdown in sales.
Goldman Sachs raised its forecast for Brent price of five dollars to $75 a barrel in the second quarter and $ 80 a barrel in the third quarter of this year, while UBS increased its forecast for Brent to $75 a barrel and for US West Texas Intermediate crude to $72 a barrel in the second half of 2021.
