Oil rises over $1 after US dollar weakens to 1-week low, OPEC+ likely to hold supply cuts; Brent hits $84/bbl
₹6,639 per barrel on the multi-commodity exchange (MCX).-OPEC+ members will decide its next output supply policy on June 2 in a virtual meeting. Traders and analysts are predicting 2.2 million barrels per day of voluntary production cuts to stay in place.
"We expect OPEC+ to extend the current cut for at least another three months at its upcoming meeting," UBS analysts said in a note.-Analysts said that this week’s upside follow-through is being facilitated by a significant weakening in the dollar and a growing consensus that OPEC+ will extend the production cuts at the upcoming weekend meeting.-The US dollar slipped 0.1 per cent to a more than one-week low. Worries over US interest rates remaining elevated for a longer period contributed to a weekly loss for crude last week.
Higher rates boost the cost of borrowing, which can dampen economic activity and demand for oil.-Investors will watch the US core personal consumption expenditures price index (PCE), which is a main inflation gauge for the Federal Reserve, due on Friday. Despite the rise in prices in the last two session, analysts noted that the interest rate concerns will most plausibly act as a brake on further attempts to send oil prices meaningfully higher in the immediate future.-Air travel data also helped to buoy oil prices, with US seat numbers on domestic flights for May rise by five per cent month on month and almost six per cent year on year to slightly above 90 million, data from flight analytics company OAG showed, surpassing 2019 levels.Milestone Alert!
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