NNA – Oil prices rose by about three percent today, recording a five-week high, and headed for gains for the second week in a row, supported by the OPEC + decision to make the largest supply cut since 2020, despite concerns about recession and high interest rates, according to the agency. Archyde.com.
Brent crude rose $2.73, or 2.9 percent, to $97.15 a barrel.
US West Texas Intermediate crude also rose $2.94, or 3.3 percent, to $91.39 a barrel.
“One of the main repercussions of the recent OPEC cuts will be the likely return to the $100 oil price, but gains will be limited in light of the growing unfavorable economic factors,” said Stephen Brennock of BVM oil brokerage.
The rise of oil continued despite the rise of the dollar after data showed that the US economy is creating jobs at a strong pace, while reinforcing expectations that the Federal Reserve (the US central bank) will continue to tighten monetary policy sharply.
The cut decided by the OPEC + cartel, which includes the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, comes before the European Union bans Russian oil and will reduce supplies in a market already suffering from tight supply.
The two benchmarks are heading to record gains for a second week, with Brent crude close to recording a 10 percent rise this week, and US crude close to 15 percent. That would be the biggest percentage increase for both crudes since March.
A stronger dollar makes oil more expensive for holders of other currencies, and usually affects oil and other risky assets.
On Thursday, US President Joe Biden expressed his disappointment with the plans of OPEC +, and he and other officials said that “the United States is studying all possible alternatives to prevent a rise in prices.”
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