Oil prices rose more than 4% on Tuesday as OPEC+ neared a compromise to hold crude production steady in February, according to Reuters. The prices were also supported by tensions around OPEC member Iran’s seizure of a South Korean vessel claiming the latter owed it $7 billion.
- Brent crude futures rose $2.15, or 4.2%, to $53.24 a barrel by 11:10 a.m. EST while the U.S. West Texas Intermediate crude gained $2.27 or 4.8%, to $49.89 a barrel.
- Sources revealed that OPEC offered to make voluntary cuts to its oil production in February to support prices.
- OPEC was concerned over any output increases on fears that the market could be flooded with crude if new coronavirus lockdowns depress demand.
- A January 4 OPEC document revealed the group was studying a range of scenarios, including more production, no change, or cutting output by 500,000 barrels per day (bpd) in February.
- Oil still faces bearish triggers with surging coronavirus and new lockdowns weighing on fuel demand.
Oil futures are currently gaining. CL! is up 4.20%