Oil prices surge as OPEC+ extends output cuts into April
Oil prices rose on Friday, extending gains from the previous session, after OPEC and its allies agreed not to increase supply in April as they await a more substantial recovery in demand amid the coronavirus pandemic, Reuters reports.
Brent crude futures for May rose 60 cents, or 0.9%, to $67.34 a barrel at 0337 GMT, and was on track for a near 2% gain in the week.
U.S. West Texas Intermediate (WTI) crude futures were up 56 cents, or 0.9%, to $64.39 per barrel.
Both contracts surged more than 4% on Thursday after the Organization of the Petroleum Exporting Countries and allies, together called OPEC+, extended oil output curbs into April, with small exemptions to Russia and Kazakhstan.
“It just goes to show how much of a surprise the OPEC+ discipline is,” said Michael McCarthy, chief market strategist at CMC Markets.
“What makes the gain even more impressive is that it comes against a risk-off backdrop and a higher U.S. dollar,” he said.
Oil prices usually fall when the dollar rises as a higher greenback makes oil more expensive for buyers with other currencies.
Investors were surprised that Saudi Arabia had decided to maintain its voluntary cut of 1 million barrels per day through April even after oil prices rallied over the past two months.