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Oil rebounds strongly, but heads for its seventh weekly drop in a row

Oil rebounds strongly, but heads for its seventh weekly drop in a row

The price of oil rebounds strongly this Friday, December 8 after Saudi Arabia and Russia They called on more OPEC+ members to join the production cuts. However the raw can’t help but go to his seventh consecutive weekly drop due to concern for global oversupply and the weak Chinese demand.

Crude oil futures West Texas Intermediate (WTI) They climbed 1.86 dollars, or 2.7%, to US$71.20 a barrel. For his part, the Brent It rises $1.76, or 2.4%, to $75.81 a barrel. The London contract advanced 2 dollars earlier.

He Brent and the WTI I also know find themselves in contangoa market structure in which prices in the immediate month are quoted at a discount with respect to more distant prices.

“The weakening of OPEC+’s support position, coupled with record US production and weak Chinese crude oil imports, can only mean one thing: there is an abundance of oil available, which is clearly reflected in the structure contango of the two main crude oil reference contracts,” says Tamas Vargafrom the PVM brokerage, in a note.

Saudi Arabia and Russia asked all OPEC+ members to join the production cuts

Saudi Arabia and Russiathe world’s two largest oil exporters, on Thursday asked all members of the OPEC+ that join a production cut agreement for the good of the World economyjust a few days after a fractious producer club meeting.

The Organization of Petroleum Exporting Countries and its alliesknown as OPEC+, They agreed to a joint production cut of 2.2 million barrels per day (bpd) for the first quarter of next year.

Brent and WTI crude oil futures are on track to fall 3.9% on the weektheir biggest losses in four weeks.

Fueling the market crash, Chinese customs data showed its crude oil imports in November fell 9% Over the previous yearas high inventory levels, weak economic indicators and slowing orders from independent refiners weakened demand.

In United States, Production remained near record highs of more than 13 million bpddata from the Energy Information Administration United States.

The market also seeks monetary policy signals in it US monthly employment report that was published this Friday showed that the growth of jobs accelerated, therefore, the expectations that the Federal Reserve will cut rates in the first quarter of 2024 were prematureaccording to the official survey.

Source: Ambito

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