The U.S. oil benchmark, WTI Crude, jumped early on Thursday to above $64 a barrel, soaring by more than 5 percent, after OPEC+ sources began telling reporters that the coalition may be close to agreeing not to increase their collective oil production in April.
WTI Crude prices were surging by 5.06% at $64.21 as of 11:18 a.m. ET on Thursday. Brent Crude prices jumped above $67 per barrel, to $67.17, up by 5.10%, after OPEC+ sources started to leak insights from the ongoing OPEC+ ministerial meeting.
According to delegates, the discussion is now about a rollover of production for all members except for Russia and Kazakhstan, “which will be allowed to boost output by 130k and 20k respectively,” Amena Bakr, deputy bureau chief & chief OPEC correspondent at Energy Intelligence, tweeted.
Saudi Arabia, OPEC’s top producer and de facto leader, is proposing a rollover of the current level of cuts into April and May, according to various reports. In addition, Saudi Arabia will be keeping its additional 1 million barrels per day (bpd) production cut in April, too. That extra cut was initially planned to last only in February and March.
Russia, as well as Kazakhstan, were pushing for an increase in the collective production. Russia, the leader of the non-OPEC group of nations in the OPEC+ pact, was reportedly pushing to get an increase in April to meet high domestic fuel demand, according to various sources and reports.
Saudi Arabia, however, as expected, was calling for a more “cautious” approach, with Saudi Energy Minister Prince Abdulaziz bin Salman saying at the meeting, as carried by Bloomberg:
“At the risk of sounding like a stuck record, I would once again urge caution and vigilance.”
“Before we take our next step forward, let us be certain the glimmer we see ahead is not the headlight of an oncoming express train,” Prince Abdulaziz bin Salman said.
The market was expecting quite a different outcome from today’s OPEC+ meeting, including Saudi Arabia reversing its extra cut and the group lifting production by as much as 500,000 bpd.
It looks like Prince Abdulaziz bin Salman was right when he said two weeks ago: “Those who are trying to predict the next move of OPEC+, to those I say, don’t try to predict the unpredictable.”
