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NEW YORK (Reuters) – US oil prices rose 5 percent, while Brent crude topped $ 26 a barrel on Friday, and both benchmarks recorded their first weekly rise in four weeks as the OPEC and its allies began to cut record production to counter excess supply due to the Corona virus crisis.
An oil rig in Texas at sunset with a photo from the Reuters file.
In April, US crude oil fell to its lowest level, while Brent reached its lowest level in 21 years, as the pandemic crashed and OPEC and other producers increased production before a new deal went into effect. supply on Friday.
July Brent futures fell four cents, or 0.2 percent, to settle at $ 26.44 a barrel, and the June contract expired Thursday at $ 25.27.
US West Texas Intermediate Crude USA The session ended, up 94 cents, or five percent, at $ 19.78 a barrel after rising to $ 20 earlier in the session.
After three consecutive weeks of losses, Brent increased 23 percent, while West Texas Intermediate added about 17 percent.
The Organization of the Petroleum Exporting Countries, Russia and other producers, in what is known as the OPEC + group, began to cut production by 9.7 million barrels per day from May 1.
Several countries and regions, including the central Chinese province of Hubei, where the emerging pandemic coronavirus first appeared, are beginning to ease the general isolation measures that have been put in place to contain the virus.
But there are doubts that the cut, which is the largest ever agreed, will be enough, as demand is unlikely to recover quickly.
A Reuters poll on Thursday showed that before the new production cut, OPEC had vigorously raised its output to the highest level since March 2019, boosting surplus supplies in the market.
Highlighting the difficulties some producers face in meeting their obligations, industry sources said Iraq will face difficulties in meeting its share of production cuts by about a quarter. Iraq is OPEC’s second largest producer.
Prices were also supported by data from the US Energy Information Administration. USA They showed that crude stocks rose nine million barrels last week to 527.6 million barrels, below analyst expectations for a 10.6 million barrel increase.
Prepared by Mahmoud Salama for the Arab Bulletin
