OPEC’s Promised Supply Cuts Helps Oil Rise – 18 June, 2020

OPEC producers and their allies reiterated their commitment to cutting global oil supplies, a move that cause prices to rise 1%, with major producers adding in that demand was increasing. Brent crude futures were up 0.8% or 35 cents to $41.86 per barrel. U.S. West Texas Intermediate crude futures were up 1% or 38 cents to $39.22 per barrel, with both producers on track for an 8% weekly gain. Iraq and Kazakhstan have agreed to cut supplies after an overproduction in May, joining the OPEC+ initiative to cut global supplies to balance the market. Storage capacity was running low as the coronavirus spread around the world and many countries imposed lockdowns that limited citizens movements, causing a drop in demand. U.S. inventories hit a new record, rising by 1.2 million barrels last week to 539.3 million barrels.