Oil rises ahead of OPEC+ meeting

Oil prices rose on Friday, thanks to expectations that the OPEC + cartel will discuss production cuts at a meeting on the fifth of September, but concerns about restrictions to combat Covid-19 in China and the weakness of the global economy continued to limit the gains.

By 1140 GMT, Brent crude futures rose $1.42, or 1.5 percent, to $93.78 a barrel, and West Texas Intermediate crude futures rose $1.43, or 1.7 percent, to $88.04 a barrel.

And crude contracts fell three percent in the previous session, to their lowest level in two weeks. Brent crude is heading towards a weekly decline of about seven percent, and West Texas Intermediate crude is heading towards a decline of about five percent during the week.

The OPEC + bloc, which includes the Organization of the Petroleum Exporting Countries (OPEC) and its allies, is scheduled to meet on September 5 against an expected demand decline. However, Saudi Arabia says that supplies remain limited.

OPEC + this week revised its market forecast for this year and now expects demand to fall short of supply by 400,000 barrels per day, downgrading to a previous forecast of 500,000. OPEC + expects a deficit in the oil market in 2023 of 300,000 barrels per day.

The market is also focused on the possibility of capping the prices of Russian oil exports.

Group of Seven finance ministers are expected to solidify plans on Friday to impose a ceiling on Russian oil prices, to limit revenue that funds Moscow’s war in Ukraine while keeping oil flowing to avoid price hikes.

Meanwhile, investors remain concerned about the impact of the new COVID-19 restrictions in China. On Thursday, the Chinese city of Chengdu ordered a shutdown that harmed manufacturers such as Volvo.