Oil rises as OPEC+ meeting eyed, global demand concerns weigh
By Alex Lawler
LONDON (Reuters) -Oil rose on Tuesday ahead of a meeting of OPEC+ producers this week that may not lead to a further boost in crude supply, although concern about a possible global recession limited gains.
The Organization of the Petroleum Exporting Countries and allies including Russia, known as OPEC+, meet on Wednesday. Two of eight sources said a modest output hike would be discussed, while the rest said a boost was unlikely.
Brent crude was up 84 cents, or 0.8%, to $100.87 a barrel at 1340 GMT, while U.S. West Texas Intermediate crude added 55 cents, or 0.6%, to $94.44.
“There’s a lot more uncertainty this time around,” said Craig Erlam of brokerage OANDA of the OPEC+ meeting. “The decision this week will tell us just how unified the group still is.”
Oil soared earlier in 2022, with Brent in March coming close to its all time high of $147 a barrel after Russia’s invasion of Ukraine added to supply concerns. Worries about slowing growth have since eclipsed tight supply.
Surveys showed on Monday that factories across the United States, Europe and Asia struggled for momentum in July as flagging global demand and China’s strict COVID-19 restrictions slowed production.
“These readings did nothing to mitigate the fears of recession,” said Tamas Varga at oil broker PVM.
Casting a cloud over the market are worries that a visit to Taiwan by U.S. Speaker of the House Nancy Pelosi will escalate tensions between the United States and China. Stocks slipped and bond yields fell on worries about the visit.
Also coming into view is the latest weekly reading on U.S. inventories. Analysts expect a decline in crude and gasoline stocks. This week’s first report is due at 2030 GMT from the American Petroleum Institute. [EIA/S]
(Additional reporting by Muyu Xu Editing by Jason Neely and Mark Potter)
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