Oil prices rise on OPEC+ supply discipline, demand prospects

Crude oil storage tanks are seen in an aerial photograph at the Cushing oil hub in Cushing, Oklahoma, U.S. April 21, 2020. (Reuters)

SULAIMANI (ESTA) — Oil prices rose on Wednesday after OPEC and its allies stuck to their plan to cautiously bring back oil supply to the markets in June and July while expecting a robust recovery in demand in the United States and China.

Brent crude futures climbed 27 cents to $70.52 a barrel by 0657 GMT, after rising 1.3% overnight, when it hit its highest since March 8.

U.S. West Texas Intermediate (WTI) crude futures rose 18 cents to $67.90, extending a 2.1% gain following the Memorial Day holiday in the United States on Monday.

The Organization of the Petroleum Exporting Countries (OPEC) and its allies, together called OPEC+, agreed on Tuesday to keep to their plan to gradually ease supply curbs through July.

“The market appears focused on the more constructive outlook for later this year, with OPEC+ of the view that the market will see significant stock drawdowns between September and the end of the year,” Reuters cited ING Economics analysts as saying.

Including extra cuts by Saudi Arabia tapering off through July, the producer group will be returning 700,000 barrels per day (bpd) in June and 840,000 bpd in July, ING said.

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