OPEC Proposal, Weaker Dollar Propel Oil by Two Percent

Published Date : Dec 04, 2015

There was an approximately 2% hike in crude futures, bolstered by a weakening dollar and a report to a senior delegate from OPEC was sent a proposal that Saudi Arabia would strike a deal that will allow the nation to balance oil prices with help from outside of OPEC.

Brent and crude futures rose again after reports of a 4% slump in Wednesday’s price that was soon short-covered.

An 80 cent jump was recorded on Brent LCOc1, which amounted to a 1.8% rise, to lead crude to US$43.29 per barrel. This was a rise of more than a dollar earlier from the same session. Wednesday witnessed a session low on the global crude benchmark with US$42.43, only 20 cents up from a low set in August after six and a half years.

A 50 cent jump was recorded by West Texas Intermediate’s CLc1. It led crude to US$40.44 per barrel, or up 1.3%. This was after CLF6, the front-month January futures, reached a low in the contract of US$39.84 on Wednesday.

The earnings were trimmed after a source from Saudi oil spoke to Reuters. He stated the report by Energy Intelligence, the industry journal, to be “baseless”. The report stated that the kingdom had initially hoped to maintain a balance in the market with the help of production limits.

A meeting from the oil ministers from the Organization of the Petroleum Exporting Countries is expected to occur in Vienna on Friday. The ministers are of the opinion that the futures for crude have been volatile.

One of the Gulf OPEC sources spoke to top agency Reuters regarding the previous discussions. He said that collectively, it will be tough to reduce the production by 1 mn barrels per day. The Saudi officials do not want to change their talks from previous sessions. There will be no cut back on productions without any external cooperation.