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Oil plummeted and closed at its lowest level since February: Brent pierced US$80

Oil plummeted and closed at its lowest level since February: Brent pierced US$80

The Oil prices fell sharply this Mondaywith the Brent even below $80 a barrel, after the Opec+ alliance announced on Sunday that It maintains production cuts, but is preparing to open the taps.

He North Sea Brent, a benchmark in Europe and Argentina, lost 3.39% on Monday, falling below $80 to $78.36. While the WTI, a reference in the United States, lost 3.59% to $74.22. The two barrels are in lows since February.

Tamas Varga, an analyst at PVM Energy, explained to AFP that this drop in prices It is related to the Opec+ meeting on Sunday. “The market is disappointed that the group is going to progressively abandon some of its production restrictions, despite the absence of tangible signs of an improvement in demand,” Indian.

The 12 members of the Organization of the Petroleum Exporting Countries (OPEC), led by Saudi Arabia, and its 10 allies, led by Russia, who form the Opec+ alliance, met on Sunday and announced that they will extend their production cut policy until December 2025.

In addition, eight member countries of the alliance announced that They will extend their voluntary crude oil production cuts for a few months.

But this group of countries – Saudi Arabia, Russia, Iraq, the United Arab Emirates, Kuwait, Kazakhstan, Algeria and Oman – will maintain this policy until September 2024 and then “phase out” these cuts.

This meeting, held in a hybrid format in which some members traveled to Riyadh and others participated by videoconference, made it possible to specify when the alliance “plans to end its supply reduction policy,” explained Ipek Ozkardeskaya of Swissquote.

Goldman Sachs, In an analysis note, he described how “bearish” or making the Opec+ decision more flexible. In other words, the alliance is preparing to open the taps and that is bearish for the market.

“This decision comes at a time when uncertainty about the outlook for Chinese demand weighs on raw materials”Lukman Otunuga, FXTM analyst, recalled to AFP.

Source: Ambito

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