Oil prices mixed over supply uncertainties

ISTANBUL

Oil prices were mixed on Thursday over supply uncertainties after OPEC+ producers decided to cut daily oil production by 2 million barrels.

International benchmark Brent crude traded at $93.22 per barrel at 10.01 a.m. local time (0701 GMT) for a 0.16% drop from the closing price of $93.37 a barrel in the previous trading session.

American benchmark West Texas Intermediate (WTI), trading at $87.52 per barrel at the same time, decreased 0.27% after the previous session closed at $87.76 a barrel.

The group of Organization of Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, agreed Wednesday to cut production by 2 million barrels per day (bpd) starting November.

The group pointed to the uncertainty that surrounds the global economy and oil market outlook, and noted "the need to enhance the long-term guidance for the oil market."

Following the group's decision, US officials said on Wednesday that US President Joe Biden "is disappointed" by OPEC+'s decision to cut oil production.

The decision will have the most negative effect on lower- and middle-income countries that are reeling from elevated energy prices, according to a statement by National Security Adviser Jake Sullivan and top economic adviser Brian Deese.

"At the President’s direction, the Department of Energy will deliver another 10 million barrels from the Strategic Petroleum Reserve to the market next month, continuing the historic releases the President ordered in March," said the statement.

Moreover, EU countries on Wednesday reached an agreement on the eighth sanctions package against Russia.

The measures include a prohibition of transporting oil to non-EU countries above a certain price, mostly affecting the shipping industry of Greece, the Greek Cypriot administration, and Malta.

The Energy Information Administration (EIA) on Wednesday showed that US commercial crude oil inventories decreased by 1.4 million barrels during the week ending Sept. 30 against the market expectation of a drop of around 1.77 million barrels.

Strategic petroleum reserves, excluded in commercial crude stocks, also fell by 6.2 million barrels, while gasoline inventories decreased by 4.7 million barrels over the same period.