TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search results
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search resultsBrace for volatility as oil supply risks loom large
OPEC and its producer allies agreed to an oil output increase of around 1 million b/d.
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
OPEC and its producer allies agreed to an oil output increase of around 1 million b/d. (Shutterstock/File)
O
il markets need to brace for high levels of volatility in the coming months amid looming supply risks and uncertainty around available spare production capacity.
The Organization of the Petroleum Exporting Countries (OPEC) and its producer allies set aside political differences and agreed on June 22 to an oil output increase of around 1 million b/d, but question marks remain around how much real volume will hit the market given that several countries are pumping at full capacity and some cannot raise production even if they want to.
The supply side risks, meanwhile, have intensified. Political turmoil in Libya has severely disrupted production there, the United States has announced that it intends to fully eliminate Iranian oil exports from the market starting November and Venezuelan production is in freefall — the International Energy Agency expects its output to drop from the current level of 1.36 million b/d to 800,000 b/d by the end of 2019.
The front-month ICE Brent futures contract, which settled at US$75.32/b after the OPEC announcement — off the $80/b level it had touched a month earlier — has since risen and is again flirting with that level.
