Oil prices rose on Monday as the OPEC+ alliance reaffirmed its decision to freeze production increases during the first quarter of 2026. This move comes as traders continue to assess the implications of recent statements regarding Venezuela by the United States.
Brent crude traded near $63 per barrel, while West Texas Intermediate (WTI) hovered around $59 per barrel. The decision to maintain production levels, initially announced earlier last month, was extended for an additional three months following the alliance’s meeting on Sunday. OPEC+ cited weak seasonal market conditions as a primary reason for this stance.
Despite this uptick, oil prices recorded their fourth consecutive monthly decline in November. However, geopolitical tensions in the Middle East and other regions have provided underlying support for prices throughout the year.
OPEC+ Approves Production Capacity Review Mechanism for 2027
During its 40th ministerial meeting, OPEC+ approved a mechanism for reviewing production capacity targets for 2027. This step reflects the alliance’s ongoing efforts to address long-term market dynamics while managing short-term challenges.
Warren Patterson, Head of Commodities Strategy at ING, commented: “Although market expectations are bearish due to a projected surplus, persistent supply risks indicate that these negative fundamentals will take longer to fully impact prices.”
U.S. Pressure on Venezuela and Global Implications
The United States recently escalated pressure on Venezuela, warning aviation companies about restricted airspace over the country and its surrounding regions. However, on Sunday, these statements were softened, leaving the market in a state of anticipation. Concurrently, military buildups by the U.S. in the region continue to fuel uncertainty.
In addition, U.S. and Ukrainian negotiators described their discussions on a potential peace framework with Russia as “constructive” but without major breakthroughs. A potential ceasefire could lead to reduced sanctions on Russia, increasing its crude oil exports and influencing the global supply-demand balance.
Saudi Oil Exports to Asia Set for Growth in December
As reported by Bloomberg, Saudi Arabia’s crude oil exports to Asian refineries are expected to grow in December. This aligns with Saudi Arabia’s strategy to maintain its market share in the region.
Sharwa Chanana, Chief Investment Strategist at Saxo Markets, noted: “Currently, geopolitical developments and OPEC+ strategies seem more focused on preventing a deeper collapse in oil prices than driving sustainable price increases. This reflects the market’s sensitivity to news-driven risks.”
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