By Adedapo Adesanya
The price of the average basket of 13 crude belonging to members of the Organisation of the Petroleum Exporting Countries (OPEC) stood at $43.02 per barrel last Friday.
Compared with the previous day’s $42.99, the basket prices rose 3 cents or 0.07 per cent according to OPEC Secretariat calculations.
The OPEC Reference Basket of Crudes (ORB) is made up of the following: Saharan Blend (Algeria), Girassol (Angola), Djeno (Congo), Zafiro (Equatorial Guinea), Rabi Light (Gabon), Iran Heavy (Islamic Republic of Iran), Basra Light (Iraq), Kuwait Export (Kuwait), Es Sider (Libya), Bonny Light (Nigeria), Arab Light (Saudi Arabia), Murban (UAE) and Merey (Venezuela).
The gain came on the back of dramatic fall in the US Dollar on Friday and was on course for its biggest monthly drop in a decade after news that the country’s gross domestic product (GDP) collapsed at a 32.9 per cent annualized rate, the deepest decline in output in 50 years.
Investors typically use dollar-denominated commodities as safe havens when the currency weakens.
In other OPEC related news, OPEC, alongside its allies known as OPEC+, is all set to step up output this month, adding about 1.5 million barrels per day to global supply. ‘
This follows the expiration of a 9.7 million daily cut that lasted for three months after oil fell to peak lows in April, last month OPEC production reached its lowest level in nearly 30 years since the gulf war.
The decision to taper the previous reduction was expected earlier today as the body also talked on extended production cuts for countries like Nigeria, Iraq, and others for not meeting their production cuts for the months of May to June.
However, the risk remains on the strength of a demand recovery as the virus seems to be rebounding in the United States and other countries.
Last month, the OPEC’s oil production increased by more than one million barrels per day after Saudi Arabia, alongside other Gulf members, ended their voluntary extra supply cuts on top of the OPEC deal.
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