WEEKLY ENERGY RECAP: OPEC+ working tirelessly to drain crude product glut

WEEKLY ENERGY RECAP: OPEC+ working tirelessly to drain crude product glut

Oil prices have escalated to the highest levels since October 2018. The Brent crude price is shyly approaching the vital $70 per barrel mark and closed the week at $69. 36 per barrel. West Texas Intermediate (WTI) closed the week at $66. 09 per barrel. Though global oil markets had anticipated an output increase from OPEC+, claiming the market can absorb 1 to 2 million additional barrels per day (bpd), OPEC+ took the market by surprise when it decided to roll over its quota, given the still-fragile global oil demand recovery. The move is not about OPEC+ protecting the current price levels that have exceeded the pre-pandemic levels, it is not about refusing to bring more oil production online, it is not about dismissing any concerns about inflation and market overheating. The current oil price levels are not at astronomical high levels to add inflationary pressure to the global economy as it emerges from the pandemic. Many market participants were expecting that OPEC+ would restore as much as 1. 5 million barrels a day of output in April. However, they were only looking at the tip of the iceberg, focusing on high fuel demand in India, depleting global inventories, the