Modestly Higher Overnight, OPEC+ Meeting Eyed

WTI & Brent crude futures have added $0.30-0.40 to Monday’s settlement levels, building on the incremental uptick witnessed during the first session of ’22.

• The latest OPEC+ gathering provides Tuesday’s focal point, with sell-side expectations looking for the group to raise cumulative output by 400K bpd during the month of February (aided by the usual run of pre-meeting source reports), as per the previous production guidance provided by the group. While there are worries regarding the ability of several participating nations when it comes to upscaling production (given the underproduction already apparent in some countries), talk of lowering quotas for some of the participating nations remains off the table at present, as the producers look to minimise cross-country tensions.
• A reminder that Monday saw OPEC's newly elected secretary general note that global oil demand should move back to its pre-COVID levels by the end of ’22. This pointed to perceptions re: a relatively short-term threat posed by the Omicron COVID strain, which allowed the OPEC+ JTC to provide a narrower estimate when it comes to its Q122 oil surplus, per source reports.