Texas oil reached $80 due to OPEC price cuts

Price from Texas Intermediate Oil (WTI) jumped at the opening this Monday by 6.01%, to $80.22 per barrel, above the $80 mark, after the OPEC + alliance confirmed a cut of 1.66 million barrels per day since May.

At 9:00 a.m. local time (1:00 p.m. GMT), WTI futures for May delivery were up $4.55 from the previous day’s close.

Benchmark US oil, which rose more than 9% last week as worries about the banking sector and a possible recession eased and managed to regain the $70 level it lost during the brief financial crisis, shot up today after unexpected cuts announced by countries oil producers.

These are “voluntary” reductions, that is, without a binding and consensual agreement within the alliance, and will be applied from May until the end of 2023.

The OPEC iHe specified that the new part was divided between Saudi Arabia and Russia, which will reduce their production by 500,000 barrels per day, Iraq (211,000 bd), United Arab Emirates (144,000 bd), Kuwait (128,000 bd), Kazakhstan (78,000 bd), Algeria (48,000 bd), Oman (40,000 bd) and Gabon (8,000 bd).

In October 2022, the group of 23 countries that make up the organization had already agreed to a sharp cut of 2 mbd, which also caused black gold to rise.

In addition, the vice president of the Russian government Alexander Novak he pointed out today that the number of OPEC+ countries that could join the voluntary reduction of crude oil production could increase.

“Other countries could join and announce additional reductions, if they consider it necessary to stabilize the market,” he said.

According to Charles Schwab analyst Michael Zaremski, “OPEC+ appears willing to take action to support oil prices and move closer to or exceed the desired price target of $80 per barrel.”

For its part, the specialized publication Insider points out that this move by the oil cartel is “shrinking global crude oil supplies and reviving concerns about inflation.”