Oil prices climbed higher on Thursday, rising for a fourth straight session, and pushed the most active oil futures contract to a more than 3-week closing high.
Oil prices continued to find support from the Organization of the Petroleum Exporting Countries and their allies’ announcement on Wednesday that they would cut production by 2 million barrels per day from November.
Data showing a drop in U.S. crude inventories in the week ended September 30th contributed as well to the rise in oil prices
West Texas Intermediate Crude oil futures for November ended higher by $0.69 or about 0.8% at $88.45 a barrel, the highest settlement since September 14.
Brent crude futures were up $1.14 or about 1.22% at $94.51 a barrel a little while ago.
OPEC and non-OPEC partners on Wednesday agreed to cut supply by 2 million barrels per day (bpd), which is equal to 2% of the global supply, defying pressure from the United States to increase supply.
The United States said the steep reduction in output was an act of aggression and “short sighted”.
Saudi Arabia defended itself saying this big cut to oil production had become necessary to respond to rising interest rates and a weaker global economy.
Morgan Stanley raised its oil price forecast for the first quarter of 2023 and predicted tight supply going forward.
Goldman Sachs increased its fourth-quarter estimate for Brent by $10 to $110 a barrel and argued that the real size of the OPEC cut, considering the supply shortfalls, would actually be about 500,000 bpd.
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