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Oil Sees Further Gains As OPEC+ Plans 2mbpd Output Cut

COMMODITIES
  • Crude oil sees further sizeable gains after OPEC+ agreed to cut 2mbpd from current output limits – its largest cut since 2020 - and Russia warned it may reduce its own output even further. The White House has pushed back, with Biden calling the move “unnecessary” whilst Saudi Oil Minister says policy is not a ‘one-way street’ with uncertainties going either way whilst they wait to see how markets react to the price cap.
  • Goldman view the OPEC+ decision as sufficiently bullish to raise its 4Q oil price forecast $10 to $110/bbl.
  • WTI is +1.5% at $87.78 for a circa 10% gain on the week to date. It clears the 50-day EMA of $87.09 and opens $89.99 (Sep 6 high).
  • Brent is +1.7% at $93.40, clearing resistance at $92.4 (Oct 4 high) and opening $95.54 (Sep 5 high).
  • Gold meanwhile dips -0.5% to $1717.47 as a reversion to higher US yields take the edge off the yellow metal. Support is seen at $1695.2 (former trendline resistance) whilst resistance is still nearby at $1729.5 (Oct 4 high).
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  • Crude oil sees further sizeable gains after OPEC+ agreed to cut 2mbpd from current output limits – its largest cut since 2020 - and Russia warned it may reduce its own output even further. The White House has pushed back, with Biden calling the move “unnecessary” whilst Saudi Oil Minister says policy is not a ‘one-way street’ with uncertainties going either way whilst they wait to see how markets react to the price cap.
  • Goldman view the OPEC+ decision as sufficiently bullish to raise its 4Q oil price forecast $10 to $110/bbl.
  • WTI is +1.5% at $87.78 for a circa 10% gain on the week to date. It clears the 50-day EMA of $87.09 and opens $89.99 (Sep 6 high).
  • Brent is +1.7% at $93.40, clearing resistance at $92.4 (Oct 4 high) and opening $95.54 (Sep 5 high).
  • Gold meanwhile dips -0.5% to $1717.47 as a reversion to higher US yields take the edge off the yellow metal. Support is seen at $1695.2 (former trendline resistance) whilst resistance is still nearby at $1729.5 (Oct 4 high).