Global crude oil prices edged lower on Thursday despite OPEC and Russia mulling a pause in the previously agreed increase in oil production after Washington’s announcement of the release of strategic crude reserves.
At 1330 hours GMT, Brent, the international benchmark for two-thirds of the world’s oil, shed $0.08 (-0.10 percent) to reach $82.17 a barrel. Similarly, the US West Texas Intermediate (WTI) price reached $78.16 a barrel, down by $0.23 (-0.29 percent).
The price for Opec Basket was recorded at $78.90 a barrel with a decrease of 1.42 percent, Arab Light was available at $82.58 with 0.18 percent decrease, and the price of Russian Sokol slipped to $83.02 with a decrease of 0.24 percent.
According to media reports, OPEC and Russia are mulling a pause in the previously agreed increase in oil production; however, other members of the Organisation of the Petroleum Exporting Countries do not see the pause as necessary. The United Arab Emirates and Kuwait are reportedly among the latter.
Saudi Arabia, the largest OPEC producer, and Russia have been at the helm of the effort to stabilise the oil supply on the global market during the Covid-19 pandemic recovery. OPEC, Russia, and a number of other oil-producing states struck a long-term deal earlier this year to boost their collective oil output by 400,000 barrels a day through next year, until they reach pre-pandemic production levels, which was slashed at the height of the pandemic to battle oversupply.
The US said on Tuesday it would release 50 million barrels of oil from its strategic reserves to curb rising gasoline prices, in a coordinated move with a number of other major oil consumers, including Japan, the UK, India, China, and South Korea. All of them, except for China, also announced the release of reserves at varying volumes. However, the plan is seen by some as an empty gesture, as its proposed volume equals roughly one day’s worth of global demand for crude.
Kamran Nazir Malik is a law graduate and master in Economics. He is associated with TLTP News Wire Service as correspondent since 2018.