Direction from OPEC + ends 5 weeks of falling oil prices

Oil prices jumped on Friday, extending their gains, after… (OPEC Plus) said it will review its plans to increase production Ahead of their next scheduled meeting if the new Omicron strain of coronavirus weakens demand, prices will break the five-week downward trajectory.

Brent crude futures rose $2.55, or 3.66%, to $72.22 a barrel at 14:29 GMT, after jumping 1.2% in the previous session. US West Texas Intermediate crude futures were not less fortunate than the previous one, as they also rose $2.31, or 3.47%, to $68.81 a barrel, adding to their gains of 1.4 percent at the end of Thursday’s trading.

Uncertainty about Omicron, government efforts to combat a new wave of infections and expectations of increased supplies have left investors nervous. Brent is on its way to end the week with a gain after combined losses of nearly 4%, while US light crude is about to end it after equalizing a previous drop of 2%, to break both of them five consecutive weeks of decline, according to Al-Sharq Al-Awsat newspaper.

The Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as (OPEC +), surprised the markets Thursday evening when it announced plans to increase oil production per month by another 400,000 barrels per day in next January. However, producers left the door open for a quick policy change if demand was hit by the Omicron containment measures. They said they might meet again before their next scheduled meeting on January 4th if necessary.

On Thursday, the White House said it welcomed the decision of (OPEC) and its allies to gradually increase oil production, but added that the United States had no plans to reconsider its decision to withdraw from crude reserves.

“We appreciate the level of close coordination in recent weeks with our partners in Saudi Arabia, the United Arab Emirates and other (OPEC +) producers to help ease price pressures,” White House spokeswoman Jen Psaki said.

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