Oil prices continue to soar on Tuesday after OPEC+ countries said they will cut production by 1.15 million barrels per day from May until the end of the year.
Brent crude had topped $85 per barrel and WTI was trading at close to $81 per barrel.
Yesterday evening WTI for May delivery rose $4.75 (6.28%), to settle at $80.42 a barrel on the New York Mercantile Exchange. Brent crude for June delivery increased $5.04 (6.31%), to close at $84.93 a barrel on the London ICE Futures Exchange.
The rally marked the biggest daily gain for WTI since April 12, 2022, and the best daily performance for Brent since March 21, 2022, according to Dow Jones Market Data.
From May some OPEC+ countries will voluntarily cut production by 1.66 million barrels per day (bpd) in addition to the current cut of 2 million bpd from November 2022, according to the communique released after the meeting of the alliance's monitoring committee, published on the OPEC website.
According to the document, Saudi Arabia will voluntarily reduce production from May to the end of 2023 by 500,000 bpd, Iraq - by 211,000 bpd, the UAE - by 144,000 bpd, Kuwait - by 128,000 bpd, Kazakhstan - by 78,000 bpd, Algeria - by 48,000 bpd, Oman - by 40,000 bpd, Gabon - by 8,000 bpd. Russia will extend the decision to reduce production by 500,000 barrels per day from the February average until the end of the year.
Goldman Sachs, for instance, revised upwards its oil price forecast for the year, now expecting Brent to trade at $95 per barrel at the end of the year, up from an earlier forecast of $90 per barrel. It also raised its 2024 oil price forecast.
