Oil has risen to the highest since 2014 with Brent topping $80.75 a barrel as an OPEC+ panel recommended proceeding with gradual supply hikes amid a rapidly tightening market.
Futures jumped as much as 1.8% in New York after the Joint Ministerial Monitoring Committee advised a 400,000-barrel-a-day increase in November, several delegates said.
The meeting will be followed by a full ministerial gathering to review the recommendation.
The market has tightened significantly following the economic recovery from the pandemic and supply disruption in the Gulf of Mexico due to Hurricane Ida.
Surging natural gas priceshave also raised the prospect of increased demand for oil products for power generation and are boosting inflationary pressures on the global economy.
Modeling from the Organization of Petroleum Exporting Countries and its allies shows oil demand will outstrip supply over the next two months.
Read Also: Oil Price gain continues touches $76, highest since 2018
Yet the alliance is unlikely to add more than the planned 400,000 barrels a day of output in November, Amrita Sen, chief oil analyst and co-founder of consultant Energy Aspects, said earlier.
“I’m not saying they won’t add more than 400,000 barrels a day down the line, but for today we think that’s unlikely,” Sen said in an interview with Bloomberg Television. “Saudi Arabia is very, very keen to reduce volatility, both on the upside and the downside. That’s the key. If suddenly prices spiked, then they’ll be very quick to react.”
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