Brent closed 0.50% higher at $100.54 and WTI ended 0.59% higher at $94.42.
Oil prices changed direction on Tuesday, ending slightly higher, on the eve of an OPEC+ meeting with an uncertain outcome and amid geopolitical tensions with China.
Brent crude from the North Sea for October delivery climbed 0.50% to $100.54. Earlier in the session, he lost 0.76%.
A barrel of US West Texas Intermediate (WTI) for September delivery rose 0.59% to $94.42 following losing as much a few hours earlier.
Prices had fallen sharply the day before due to weak July manufacturing PMI indices around the world. They recovered pending the meeting of the Organization of Petroleum Exporting Countries (OPEC) and their ten partners in the OPEC + agreement, Wednesday in Vienna, the headquarters of the group.
On paper, OPEC+ has halted production cuts in 2020 due to the Covid-19 pandemic and collapsing demand, “although many members are struggling to meet their quotas. totals,” noted SPI analyst Stephen Innes.
“From October 2021 to June 2022, production was well below the promised increases,” he continues.
The meeting by videoconference is surrounded by much more uncertainty than previous meetings, the alliance no longer evolving according to “a pre-established trajectory”, underlined Craig Erlam, of Oanda.
“The decision that will be made this week will tell us how united the group is still, how committed it is to rebalancing the market and whether (US) President Joe Biden has any influence on the cartel,” he said. he as the US leader visited the Middle East and pleaded with Riyadh for an increase in Saudi production.
But according to John Kilduff of Again Capital, “there are questions regarding the ability of Saudi Arabia and other OPEC members to do more.” “It is not at all certain that they have the capacity,” added the analyst.
Another factor that contributed to the progress of the courses, “general anxiety” because of the situation in Taiwan where the speaker of the American House of Representatives Nancy Pelosi landed despite threats from Beijing which considers this incursion as a provocation.
“Having said that, I would emphasize that outside the Middle East, a conflict is generally bearish for oil because it weighs more on demand than on supply,” the expert tempered.
Finally, another argument in favor of a slight rise in prices, analysts predicted a new drain in US stocks of crude oil, the figures of which will be published by the Department of Energy on Wednesday.
