Key events
Introduction: Opec+ to pause oil output rises next year
Jillian Ambrose
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
The oil price is rising after the world’s biggest oil producers agreed to pause their planned oil production hikes in the first months of next year, to assuage fears that the global market may become oversupplied with crude.
At a meeting of the Organization of Petroleum Exporting Countries (Opec) and its allies on Sunday, led by Saudi Arabia and Russia, energy ministers agreed to nudge the cartel’s exports up by 137,000 barrels a day in December, before halting any further rises in January, February and March.
The decision marks a change of policy from the eight-strong group which has increased its production quota by almost 3m barrels of crude a day over the past year. The group has opted to slow its growth in recent months to avoid a collapse in oil prices amid growing concerns of a market oversupply.
“OPEC+ is blinking — but it’s a calculated blink,” said Jorge Leon from Rystad, adding:
“Sanctions on Russian producers have injected a new layer of uncertainty into supply forecasts, and the group knows that overproducing now could backfire later.”
This morning, Brent crude has gained 0.75% to $65.25 per barrel, with US crude up a similar amount to $61.44 per barrel.
Oil prices fell to a five-month low of about $60 a barrel on 20 October on concerns that a glut was building in the market – but prices then recovered following a raft of sanctions against Russian oil barrels and a thawing of trade relations between the US and China.
The agenda
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9am GMT: Eurozone manufacturing PMI for October
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9.30am GMT: UK manufacturing PMI for October
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9.30am GMT: UK public sector productivity statistics
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2.45pm GMT: US manufacturing PMI for October
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