Oil falls to $88/barrel, OPEC considers 1mbpd cut

Brent, the international benchmark for crude oil, increased in value on Monday. This is due to the fact that the Organisation of Petroleum Exporting Countries and its allies are considering a more than one million-barrel-per-day reduction in oil production when they meet on October 5, 2022.Infomation Guide Nigeria

As of 6:03 p.m. Nigerian time on Monday, Brent’s price had increased by 3.7%, or $3.15, to $88.3/barrel, according to industry data.

On Monday, the price of another another oil grade, WTI, jumped. At the same time, it closed at $82.83/barrel, up $3.36 or 4.23 percent.

Monday evening at 6:06 p.m., the price of oil grades in the OPEC Basket declined by $0.42, or 0.45%, to $92.34 a barrel.
This occurred as OPEC sources informed Reuters that the oil cartel and its allies were considering a production cut of over one million barrels per day at their meeting scheduled for tomorrow (Wednesday).

Last week’s projections for a drop ranged from 500,000 bpd to 1 million bpd; the most recent estimate is slightly higher.Jamb Result

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The summit to discuss a cut in the global oil supply is taking place at a time when governments throughout the world are fighting to manage inflation that is out of control. A reduction in supply causes consumer petroleum prices to increase.
The face–to-face meeting of 13 OPEC countries led by Saudi Arabia and 10 associate members led by Russia will take place in the capital of Austria on Wednesday for the first time since the spring of 2020.

“It is a meeting that is taking place at a very interesting global time,” one of the sources told Reuters.\

In August, Saudi Arabia, the de facto leader of the Organization of Petroleum Exporting Countries (OPEC), signalled the prospect of production cuts to stabilise the market.

When the pandemic caused oil prices to plummet, the cartel committed to massive cuts in output through 2020. However, as the market rebounded in 2016, the cartel began to raise supply.

Now, production cuts are being discussed as a result of a drop in oil prices from multi-year highs reached in March and market volatility.

Oil prices jumped to about $140/barrel in March as a result of Russia’s invasion of Ukraine, but have since dropped to approximately $80/barrel due to recession fears.

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