Oil Rises as OPEC+ Resumes Talks to Extend Production Cuts

Oil prices rose Thursday, December 3, after a dispute erupted between two producers, including Saudi Arabia and Russia, over the need to extend the deadline for record production cuts that began during the first wave of the Covid-19 pandemic.

Brent crude rose 21 cents, or 0.4%, to $48.46 a barrel by 08:02 GMT, after gaining 1.8% on Wednesday. US oil rose 11 cents, or 0.2%, to $ 45.39 a barrel, after closing 1.6% higher in the previous session.

The Organization of the Petroleum Exporting Countries “OPEC” and Russia will resume their talks today, Thursday, to agree on policies for 2021, after discussions held earlier did not result in finding a settlement on how to face weak oil demand in the midst of a new wave of the pandemic.

It was widely expected that OPEC and its allies, under what is known as OPEC+, would extend existing production cuts of 7.7 million barrels per day, or 8% of global supply, until at least March 2021. But after hopes of speedy approval of vaccines to prevent the virus resulted in a rise in oil prices at the end of November, some producers began to question the need to tighten oil policy, which Saudi Arabia, a prominent member of OPEC, supports.

In the United States, crude inventories fell last week, while gasoline and distillate stocks rose significantly, with refinery production slowing due to declining demand, the US Energy Information Administration said on Wednesday.