OPEC+ leaning toward extension of oil output cuts

Omkar Godbole FXStreet Contributor

OPEC+, a group of major oil producers led by Saudi Arabia and Russia, are leading toward delaying the planned production boost to compensate for a slowdown in economic activity due to the second wave of coronavirus and rising Libyan oil output, sources told Reuters.

Producers were due to raise output by 2 million barrels per day (bpd) in January as the global economy showed signs of life at the end of the third quarter with easing coronavirus lockdown restrictions.

However, the number of new cases has surged across the globe over the past few weeks, reviving fears of a double-dip recession. As such, the OPEC+ OPEC+ is now considering delaying the increase.

"It looks like the extension is needed," a source told Reuters, citing "possible price drops and demand uncertainties" amid the second wave of the virus.

OPEC+ implemented record output cuts of 9.7 million bpd from May 1 to rebalance the market. The deal was revised to 7.7 million bpd in the third quarter.

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

EUR/USD trims gains, back below 1.1800

EUR/USD now loses some upside momentum, returning to the area below the 1.1800 support as the Greenback manages to regain some composure following the SCOTUS-led pullback earlier in the session.

GBP/USD off highs, recedes to the sub-1.3500 area

Following earlier highs north of 1.3500 the figure, GBP/USD now faces some renewed downside pressure, revisiting the 1.3490 zone as the US Dollar manages to regain some upside impulse in the latter part of the NA session on Friday.

Gold climbs to weekly tops, approaches $5,100/oz

Gold keeps the bid tone well in place at the end of the week, now hitting fresh weekly highs and retargeting the key $5,100 mark per troy ounce. The move higher in the yellow metal comes in response to ongoing geopolitical tensions in the Middle East and modest losses in the US Dollar.