Oil prices up on hopes of further Opec+ supply cuts

TOKYO • Oil prices edged higher yesterday on hopes that the Organisation of Petroleum Exporting Countries (Opec) and other producers may cut their output further amid falling demand for crude as China battles the coronavirus epidemic.

Brent crude futures rose 30 US cents, or 0.6 per cent, to US$55.23 a barrel by 0945 GMT (5.45pm Singapore time), but were heading for a fifth weekly loss due to lingering fears over the impact of the virus.

United States West Texas Intermediate crude futures were up 21 US cents, or 0.4 per cent, at US$51.16 a barrel, also heading for a fifth consecutive week of losses.

Prices came off earlier highs in the session after China's central bank governor said the world's second-biggest economy may experience disruptions in the first quarter.

A panel advising Opec and its allies led by Russia, known as the Opec+ group, suggested provisionally cutting output by 600,000 barrels per day (bpd), three sources told Reuters on Thursday.

The Opec+ group, which pumps more than 40 per cent of the world's oil, has been withholding supply and agreed to deepen the cuts by 500,000 bpd from the start of this year, to 1.7 million bpd, nearly 2 per cent of global demand.

Oil prices have fallen by more than a fifth since the outbreak of the virus in the city of Wuhan in China.

REUTERS

A version of this article appeared in the print edition of The Straits Times on February 08, 2020, with the headline 'Oil prices up on hopes of further Opec+ supply cuts'. Print Edition | Subscribe