Oil bounces back, the OPEC suggests an extension of the reductions in production

Investing.com – oil prices rebounded Monday after the saudi minister of Energy, Khalid al-Falih, indicated that a consensus was gathering between OPEC and its allies, led by Russia, for an extension of the agreement to reduce the production.

Falih insisted on the fact that the group was close to an agreement to extension of their contract, which expires currently at the end of the month, until the second half of the year, with the aim of rebalancing the market, according to a report by Arab News.

Despite some speculation about a postponement until July, OPEC must always hold its official meeting on 25 June in Vienna, the ministers of countries that are not members of OPEC is expected for the next day.

“We will take the necessary steps to maintain the stability of the market in addition to June. For me, this means reducing the stocks levels are currently high, ” said Falih.

The price of oil, which had fallen this night, have rebounded following the declaration, breaking with a series of losses in four days that led to the gross loss weekly of almost 9%. The futures contracts of West Texas Intermediate crude traded in New York were up 66 cents, or 1.2%, to 54,16$ per barrel at 13: 40, while the price index of the oil out of the United States, increased 64 cents, or 1.0%, to settle at 62,63$.

The escalation of trade tensions between the United States and China has weighed on crude prices, investors fearing a global recession that would seriously jeopardize the application.

The oil has recorded its worst monthly performance in six months in the month of may as a result of these concerns, eliminating nearly half of the increase in 2019 resulting from the agreement to reduce the production started this year, as well as u.s. sanctions against Iran and Venezuela, and several supply disruptions.

In the trading of other energy products, the future on gasoline rose 0.2% to 1,7747$ a gallon, while heating oil rose 0.4% to 1,8485 per gallon.

Finally, the future of the natural gas yielded 0.7% to 2,437$ per BTU.

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