Oil Price Fundamental Daily Forecast – US May Have to Release Oil Reserves to Stem Rising Prices

U.S. West Texas Intermediate and international-benchmark Brent crude oil futures are edging higher shortly after the regular session opening on Friday after OPEC and its allies moved forward with its plans for a gradual increase in production. Ahead of the decision, the group known as OPEC+, faced opposition from the United States and other major consumers, who wanted the producers to raise supply in order to cap prices.

At 12:38 GMT, December WTI crude oil futures are trading $79.68, up $0.87 or +1.10% and January Brent crude oil futures are at $81.19, up $0.65 or +0.81%.

OPEC+ Rebuffs US Call to Boost Output

OPEC and its allies agreed on Thursday to stick to their plan to raise oil output by 400,000 barrels per day (bpd) from December, ignoring calls from U.S. President Joe Biden for extra output to cool rising prices.

Top OPEC producer Saudi Arabia dismissed calls for speedier increases from the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, collectively known as OPEC+, citing economic headwinds, Reuters reported.

President Biden Blames OPEC+ for Sharp Rise in Fuel Prices

President Joe Biden has squarely blamed the reluctance of OPEC and its allies, to pump more oil for the sharp rise in energy prices in the U.S. and around the world.

“The idea that Russia and Saudi Arabia and other major producers are not going to pump more oil so people can have gasoline to get to and from work, for example, is not right,” Biden said Sunday at the G-20 meeting in Rome.

U.S. Energy Secretary Jennifer Granholm even called on oil-producing nations to immediately increase crude supplies to mitigate the surging cost of living.

“The message is we need to increase supply at this moment so that people will not be hurt during the winter months,” Granholm told CNBC’s Steve Sedgwick on Friday at the COP26 climate summit in Glasgow, Scotland.

Short-Term Outlook

Although prices are moving higher on Friday, traders are taking a cautious approach after the market fell sharply the previous session as Saudi TV reported looming a looming output rise.

According to the report, Saudi Arabia’s oil output will soon surpass 10 million barrels per day for the first time since the outset of the COVID-19 pandemic. The report, from Saudi-owned Al Arabiya TV, came after the nation, along with other OPEC countries, agreed to stick to previously agreed upon production increases.