OPEC+ Votes to Maintain Production Levels
December 5, 2022
OPEC+ did not make any changes and left their current production cut of 2 million bpd in place until the end of the 2023.
The market is also dealing with European Union imports ban and the G7 countries price cap. Crude oil is up over $2 dollars per barrels but doesn’t seem like there is any big push to prices on the upside. The price cap was set at $60 per barrel and will be kept at least 5% below market price. Many traders think this is not a big deal since Russia is already selling oil discounted below $60.
China appears to be easing some of their COVID-19 restriction after the recent protest. China is a big unknow in terms of energy demand but actions like this give the market hope that China’s economy will rebound and energy demand as well. China is a huge wildcard for energy markets.
Baker Hughes reported that oil rigs had no change in the last week and total rigs remain at 627 oil rigs.
Reuters reported that the G7 price cap would allow non-EU countries to continue importing seaborn Russian crude oil. Still, it will prohibit the shipping, insurance, and re-insurance companies from handling cargoes of Russian crude around the globe unless it is sold for less than the price cap.