Crude values rise on possible OPEC+ output cut

Front-month ICE Brent has gained by $2.29/bbl on the day, to $88.27/bbl at 09.00 GMT.

PHOTO: Russia is likely to propose that OPEC+ reduces its oil production by nearly 1 million b/d. Getty Images

Upward pressure:

Brent has made a significant gain amid expectations of a Russia-backed OPEC+ output cut at the group's meeting next week. Russia is likely to propose that OPEC+ reduces oil output by nearly 1 million b/d, according to sources cited by Reuters.

The US Energy Information Administration (EIA) reported a modest crude oil inventory decline of 200,000 bbls in the week to 23 September. This ran completely counter to the American Petroleum Institute’s earlier prediction of a build of around 4 million bbls.

Downward pressure:

Prospects for global economic growth have dimmed, according to the World Economic Forum’s (WEF) chief economist report. Most respondents to a survey in the report think a global recession is likely as growth expectations have been "pared back" in all regions.

Meanwhile, World Trade Organisation (WTO) chief has joined the chorus of concern over a global economic recession. WTO Director-General Ngozi Okonjo-Iweala believes the world is headed towards a global recession due to multiple conflicts colliding but advises policymakers to "think about recovery and measures to restore growth"

By Konica Bhatt

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