Despite the pressure to ramp up output, OPEC+ was concerned that a fourth global wave of COVID-19 infections could hit the demand recovery, a source told Reuters a little before the vote.
"The (price) move looks a bit outsized given the ministers just reaffirmed the decision announced in July, but it shows how tight the market is, reinforcing our view of asymmetric price action with risks skewed to the upside at these inventory levels," Barclays said in a note.
Investors will closely watch Wednesday's crude inventory data from the U.S. Energy Information Administration for further direction.
OPEC has a clear interest in sustaining reasonably high prices but not so high that significant additional supply is encouraged back into the market. At prices above $80, a lot of marginal supply becomes economic and it takes about 6 months to bring significant volumes online.Click HERE to subscribe to Fuller Treacy Money Back to top