traded higher on Monday morning after the Organization of the Petroleum Exporting Countries and allies (OPEC+) announced a smaller-than-expected production hike for November.
At 9.57 am on Monday, December Brent oil futures were at $65.52, up by 1.53 per cent, and November crude oil futures on WTI (West Texas Intermediate) were at $61.84, up by 1.58 per cent. October crude oil futures were trading at ₹5498 on Multi Commodity Exchange (MCX) during the initial hour of trading on Monday against the previous close of ₹5439, up by 1.08 per cent, and November futures were trading at ₹5479 against the previous close of ₹5427, up by 0.96 per cent.
A statement by OPEC+ said that in view of a steady global economic outlook and current healthy market fundamentals, as reflected in the low oil inventories, the eight participating countries (Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman) decided to implement a production adjustment of 137,000 barrels per day from the 1.65 million barrels per day additional voluntary adjustments announced in April 2023. This adjustment will be implemented in November 2025.
The countries will continue to closely monitor and assess market conditions, and in their continuous efforts to support market stability, they reaffirmed the importance of adopting a cautious approach and retaining full flexibility to pause or reverse the additional voluntary production adjustments, including the previously implemented voluntary adjustments of the 2.2 million barrels per day announced in November 2023, it said.
The eight OPEC+ countries also noted that this measure will provide an opportunity for the participating countries to accelerate their compensation. The eight countries reiterated their collective commitment to achieve full conformity with the Declaration of Cooperation, including the additional voluntary production adjustments that will be monitored by the Joint Ministerial Monitoring Committee.
They also confirmed their intention to fully compensate for any overproduced volume since January 2024. The eight OPEC+ countries will hold monthly meetings to review market conditions, conformity, and compensation.
Earlier some market reports said that OPEC+ would increase the production output by 500,000 barrels per day in November. This had led to a huge sell-off in the market last week. The latest announcement by OPEC+ to increase production output by 137,000 barrels a day was much below the expectations of some market traders.
The next meeting of OPEC+ is scheduled for November 2.
October natural gas futures were trading at ₹302.70 on MCX during the initial hour of trading on Monday against the previous close of ₹298.30, up by 1.48 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), October dhaniya contracts were trading at ₹8,332 in the initial hour of trading on Monday against the previous close of ₹8,378, down by 0.55 per cent.
October jeeera futures were trading at ₹18,560 on NCDEX in the initial hour of trading on Monday against the previous close of ₹18,940, down by 2.01 per cent.