Oil prices edged higher on Monday after a weak start, holding on to the past three months of gains, although patchy coronavirus vaccine rollouts, new infections and the discovery of new variants are keeping a lid on prices.
Oil Futures Settle Higher As OPEC, Saudi Arabia s Production Cuts Take Effect
WASHINGTON (dpa-AFX) - Crude oil futures ended sharply higher on Monday amid optimism about vaccination rollout picking up pace and as the Organization of the Petroleum Exporting Countries and its allies production cut agreement became effective.
Saudi Arabia s unilateral move to cut crude output by 1 million barrels per day contributed as well to the jump in oil prices.
West Texas Intermediate Crude oil futures for March ended stronger by $1.35 or about 2.6% at $53.55 a barrel.
Brent crude futures were up $1.43 or 2.6% at $56.45 a barrel a little while ago.
OPEC s joint technical committee will meet on Tuesday. A day later, the agency s Joint Ministerial Monitoring Committee that includes delegates from Russia, Kaxakhstan and others, is scheduled to meet.
OPEC+ JMMC compliance may be good, but markets only held because of Saudi cuts
Cornelia Meyer
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It is that time of the month: OPEC+ (an alliance between OPEC and 10 nations led by Russia) is set to hold its monthly Joint Ministerial Monitoring Committee (JMMC) meeting where ministers led by Saudi Energy Minister Prince Abdul Aziz bin Salman and Russia’s Deputy Prime Minister Alexander Novak monitor compliance with the organization’s production regime.
The outcome is expected to be positive a compliance of about 99 percent for the group or thereabouts. In January, compliance for the group stood above 100 percent.
US
The two big data releases for the US will be the ISM manufacturing and the employment report. The ISM manufacturing reading is expected to show a small decline in January. The US nonfarm payroll report is supposed to show a rebound of 50,000 jobs in January, but it will be difficult as optimism is low for any signs of a rebound in leisure and hospitality jobs.
US Politics
A busy week in DC will have investors following every incremental update on the COVID relief bill and whether Treasury Secretary Yellen will tweak the strategy with debt issuance. On the stimulus front, lawmakers are early in negotiations so the divide should remain wide on what is an acceptable headline price tag of fiscal support.
15 Jan in 6:31 S&P Global Platts
Saudi Arabia s cooperation with Russia within OPEC+ has helped stabilize crude markets and the kingdom looks forward to further collaboration with Moscow as the world s biggest oil exporter seeks to remain a key player in market stability, the kingdom s foreign minister Faisal bin Farhan said.
The cooperation between Russia and Saudi Arabia within OPEC+ not only contributed to the stabilization of the energy products markets but also protected the global economic system from the dangerous effects that could have happened from instability in these markets, bin Farhan said in a joint press conference with his Russian counterpart Sergey Lavrov in Moscow, S&P Global Platts writes in the article