U.S. West Texas Intermediate are edging higher on Friday after OPEC and its allies moved forward with its plans for a gradual increase in production. Ahead of the decision, the group known as OPEC+, faced opposition from the United States and other major consumers, who wanted the producers to raise supply in order to cap prices.
Although the market is in a position to end the week with a higher session on Friday, the technical picture has turned slightly bearish In the meantime, traders are now facing the possibility of increased output from Saudi Arabia on top of rising supply concerns in the United States. Nonetheless, the outlook remains favorable because of growing global demand due to the pace of the economic recovery.
The wildcard next week could be the release of oil from the U.S. strategic reserve after OPEC+ rejected requests from the U.S. and other nations to increase supply ahead of winter.
OPEC+ Rebuffs US Call to Boost Output
OPEC and its allies agreed on Thursday to stick to their plan to raise oil output by 400,000 barrels per day (bpd) from December, ignoring calls from U.S. President Joe Biden for extra output to cool rising prices.
Top OPEC producer Saudi Arabia dismissed calls for speedier increases from the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, collectively known as OPEC+, citing economic headwinds, Reuters reported.
President Biden Blames OPEC+ for Sharp Rise in Fuel Prices