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The Organisation of Petroleum Exporting Countries and allies (OPEC+) has commenced a plan to increment output raise for the year following a resolution of disputes between members.
The group earlier had a revision of its 2022 oil demand forecast to 4.2 million barrels per day (BPD), up from the previous forecast of 3.28 million BPD.
U.S. President Joe Biden’s administration is also pushing the OPEC+ for a quick raise in output to support the global economy rising gasoline prices that threaten the recovery of the global economy.
During its joint technical committee (JTC), the OPEC+ presented a report on the state of the oil market in 2021-2022. It further forecasts a global oil demand growth of 5.95 million BPD in 2021 after a historic drop of to about 9 million BPD in 2020 due to the Covid-19 pandemic.
The forecast acts as a catalyst for the OPEC+ to quickly increase output.
Following this, the group met to set policies which according to Reuters will most likely recycle existing policies and more so, stick with 400,000 barrels per day (bpd) each month through to December.
Its policies will supersede any requests to draw more oil.
The meeting has triggered a jump in the market prices of crude oil after a dive down due to rising cases of covid-19 delta variant.
Lockdowns in China, as well as Covid-19 vaccines effectiveness issues, had also weighed on the crude oil market.
Benchmark Brent crude traded at a record high of above $72 per barrel.
West Texas Intermediate (WTI) crude for October traded at $68.81 a barrel.
