Published by Uma Rajagopal
Posted on December 6, 2024
3 min readLast updated: January 28, 2026
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By Georgina McCartney
HOUSTON (Reuters) -Oil prices fell on Thursday as investors weighed an ample supply outlook for next year against OPEC+ delaying its planned output increase by three months to April 2025.
Brent crude settled down 22 cents, or 0.3%, at $72.09 a barrel, while U.S. West Texas Intermediate (WTI) settled down 24 cents, or 0.35%, at $68.30 a barrel.
OPEC+, the Organization of the Petroleum Exporting Countries plus allies including Russia, had been planning to start unwinding cuts from October 2024, but slowing global demand and booming production outside of the group forced it to postpone the plans on several occasions.
“There were questions coming into the meeting as to whether there was cohesion or not (among OPEC+), they are definitely coming out of this unified but this also shows the challenging supply landscape they have before them while trying to prop up this market,” said John Kilduff, partner at Again Capital in New York.
The gradual unwinding of 2.2 million barrels per day (bpd) of cuts will start from next April with monthly increases of 138,000 bpd, according to Reuters calculations, and lasting 18 months until September 2026. OPEC+ pumps around half the world’s oil.
The overall signal to the market is constructive and will likely prevent any price downsides in the short term,” Rystad Energy’s global head of commodity markets for oil, Mukesh Sahdev, said in a note on Thursday.
But analysts pointed to an ample supply outlook for 2025 as offsetting support from Thursday’s OPEC+ decision.
The market is facing a surplus, there is no shortage of oil and there is not really any flashing sign of what to look forward to in the future to rally prices,” said Bob Yawger, director of energy futures at Mizuho.
Meanwhile, a cooling U.S. dollar was lending some support on Thursday. And expectations for the Federal Reserve to cut interest rates this month will further ease the dollar’s strength and support the oil market, StoneX energy analyst Alex Hodes said in a note on Thursday.
A stronger greenback makes dollar-denominated oil more expensive for investors holding other currencies, hurting demand.
In the Middle East, Israel said on Tuesday it would return to war with Hezbollah if their truce collapses and its attacks would go deeper into Lebanon and target the state itself.
Meanwhile, Donald Trump’s Middle East envoy has travelled to Qatar and Israel to kick-start the U.S. president-elect’s diplomatic push to help reach a Gaza ceasefire and hostage release deal before he takes office on Jan. 20, a source briefed on the talks told Reuters.
(Reporting by Georgina McCartney in Houston, Paul Carsten in London, Arunima Kumar in Bengaluru and Jeslyn Lerh in Singapore; Additional reporting by Yuka Obayashi in Tokyo and Robert Harvey and Anna Hirtenstein in London; editing by David Evans, Jonathan Oatis and Deepa Babington)
OPEC+ is a coalition of oil-producing countries, including members of the Organization of the Petroleum Exporting Countries (OPEC) and other nations like Russia, that coordinate oil production policies to manage oil prices.
Brent crude is a major trading classification of crude oil originating from the North Sea. It serves as a benchmark for oil prices worldwide and is used to price two-thirds of the world's internationally traded crude oil supplies.
West Texas Intermediate (WTI) is a grade of crude oil used as a benchmark in oil pricing. It is sourced from the U.S. and is known for its light and sweet characteristics, making it desirable for refining.
A surplus in the oil market occurs when the supply of oil exceeds demand. This can lead to lower prices as producers may need to reduce output or offer discounts to sell their excess oil.
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