OPEC+ raises output quota ceiling for September by 100,000 barrels per day
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The Organisation for Petroleum Exporting Countries and its main allies, whom together are known as OPEC+, revised their combined output quotas for September higher but by far less than in the previous month.
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Nevertheless, Brent crude oil futures slipped in response, possibly as some analysts had been anticipating for a long time that the cartel would be unable to continue raising its quotas at the same pace as earlier in the year due to a lack of spare capacity in most member countries.
As of 1638 BST, front-dated Brent crude oil futures were slipping by 2.03% to $98.51 a barrel on the ICE.
Producer nations agreed on a 100,000 barrel per day hike in their quotas for the following month, following the 648,000 b/d increase decided on for August.
Furthemore, as Edward Gardner, commodities economist at Capital Economics pointed out, actual production by OPEC+ ran at just 38m b/d in June, versus a quota for 40.8m b/d.
All of the above was on top of an expected decline in drawdowns from the US Strategic Reserve from approximately 8m b/d at their peak in June to 5m b/d at present and with a further dwindling anticipated through to October.
Capital Economics's forecast for the remainder of 2022 was for Brent crude oil to settle at around $100 per barrel.