Oil prices continued to rise on Monday, gaining more than US$1 per barrel after OPEC+ announced a one-month delay in plans to increase production.
This increase comes as the market prepares for a week that includes a U.S. presidential election and a significant meeting in China, News.Az reports, citing Reuters.
Brent futures rose by US$1.18 per barrel, or 1.61%, to stand at US$74.28 a barrel by 0402 GMT. U.S. West Texas Intermediate (WTI) crude rose by US$1.21 a barrel, or 1.74%, to stand at US$70.70.
On Sunday, OPEC+, which includes the Organization of the Petroleum Exporting Countries plus Russia and other allies, said it would extend its output cut of 2.2 million barrels per day (bpd) for another month in December, with an increase already delayed from October because of falling prices and weak demand.
The grouping had been due to increase output by 180,000 bpd from December.
Brent and WTI posted weekly declines last week of about 4% and 3%, respectively, as record U.S. output weighed on prices. But both contracts edged up on Friday on reports that Iran could launch a retaliatory strike on Israel within days.
On Thursday, U.S. news website Axios said Israeli intelligence suggested that Iran was preparing to attack Israel from Iraq within days , citing two unidentified Israeli sources.
It is questionable whether the price uptrend will be sustained as previous initial positive reaction to the delayed output hike and geopolitical tension have eventually fizzled off, said Yeap Jun Rong, a market strategist at IG.
For now, oil prices may stay in a broad consolidation range, with any upside likely to find some resistance at the level of US$78.50, he added.
Markets await Tuesday’s U.S. presidential election, with polls showing Democratic Vice President Kamala Harris and Republican former President Donald Trump neck-and-neck.