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Oil Down as Consumers Fight Back, Putin Says OPEC+ to Produce More 

CommoditiesOct 21, 2021 02:48PM ET
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© Reuters.

(updates with settlement prices, add natural gas and weather forecasts)

By Barani Krishnan

Investing.com - Crude markets settled with their biggest loss in two weeks on Thursday after Russian President Vladimir Putin said the OPEC+ cartel which includes Moscow might put out more barrels than it has announced.

Oil prices were also down as China, India and other consumers fought back against high energy prices which they said could ruin their economies with runaway inflation. 

Adding to the pressure on energy markets were expectations that much of the United States will have a warmer-than-average winter, following a downgrade to cold conditions by the National Oceanic and Atmospheric Administration. Natural gas  prices fell almost 1% on the day after weekly storage levels rose slightly more than expected, another indication of warmer weather and less use for heating this fall.

In Putin’s case, he surprised markets by announcing that the OPEC+ was increasing oil output “a bit more than agreed”. That was in contrast to what most in the 23-nation oil producing alliance, led by Saudi Arabia, have been saying. 

Officially, at its meeting in early October, OPEC+ said it will not add more than the 400,000 barrels per day increase it had committed to previously, despite a global supply squeeze that has sent prices to seven-year highs.

“Not all countries are able to significantly raise oil production,” Putin said, implying that Russia might be the exception. Besides him, Iraq's Oil Minister has also said that Baghdad has the capacity to pump more.

The OPEC+ arrangement, in place since 2015, has worked largely due to the cooperation between Russia and Saudi Arabia — the world’s largest oil producers, aside from the United States, which has lost its number one ranking since the onset of the coronavirus pandemic in March 2020.

The Moscow-Riyadh pact has not been without its problems, however. A disagreement between the two on production led to a brief collapse of OPEC+’s working order before the pandemic, sparking a global supply glut that sent U.S. crude prices into negative territory the first time ever.

In Thursday’s session, U.S. crude’s West Texas Intermediate benchmark settled down 92 cents, or 1.1%, at $82.50 per barrel — its biggest one-day drop since Oct. 6. WTI fell to as low as $80.81 earlier. On Wednesday, it hit a high of $84.25, marking a seven-year peak.

London-traded Brent crude, the global benchmark for oil, settled down $1.21, or 1.4%, at $84.61. Brent hit a three-year high of $86.09 on Tuesday.

Aside from crude, falling coal markets in Asia also pressured prices across energy space on Thursday,

The benchmark January thermal coal contract on the Zhengzhou Commodity Exchange settled at below 1,588 yuan from Tuesday’s record high of 1,982 yuan after China’s National Development and Reform Commission said it will “study specific measures" to push down local prices for coal

India, the world's third-biggest energy consumer after the United States and China, said on Thursday it wanted oil producers to consider supplying crude under longer-term contracts at fixed rates to help shield consumers from price volatility. 

Oil Down as Consumers Fight Back, Putin Says OPEC+ to Produce More 
 

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Comments (12)
Gregory Bashaw
Gregory Bashaw Oct 22, 2021 12:25AM ET
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Whatever happened to the oul that we had in Oklahoma they had all over tje place when Futures contracts were -37.00 per narrel
Jose Maderno
Jose Maderno Oct 21, 2021 6:54PM ET
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Reuters has been trying to talk oil down for months for their favorite politicians.  As with almost everything Reuters writes about, you would be wise to ignore it.  Your pocketbook will thank you.
Barani Krishnan
Barani Krishnan Oct 21, 2021 6:54PM ET
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Jose, take your hatred for Reuters elsewhere. This is MY story. Got it?
Devrim Demir
Devrim Demir Oct 21, 2021 6:32PM ET
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Oil increasing and winter is coming, that news can’t catch oil prices. 90-100 is possible soon, people coming oil stocks from tech stocks. December , Jan will be best for oil stocks and for oil.
Louis Lipps
Louis Lipps Oct 21, 2021 4:47PM ET
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Energy consolidating until earnings when companies will still be afraid to pump more in fear of getting creamed by their investors.  Once Fed announces taper in November the market will flip 180 degrees and energy will surge into year end as tech flounders/tanks.
SOR BUN LY
SOR BUN LY Oct 21, 2021 3:37PM ET
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i'am need help full everything
SOR BUN LY
SOR BUN LY Oct 21, 2021 3:36PM ET
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Please help me Apple Cash data that can no longer be tied to you may be retained for a limited period of time to generally improve Apple Pay and other Apple products and services. app law goverment Cambodia Country
Jamie An
Jamie An Oct 21, 2021 3:20PM ET
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Are there anybody who trust Putin? ha ha ha... Gee...
Barani Krishnan
Barani Krishnan Oct 21, 2021 3:20PM ET
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Good question!
Lars Hellman
LarsH Oct 21, 2021 3:20PM ET
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Putin is not a lier like American presidents.
Aydin Bakhshinezhad
Aydin Bakhshinezhad Oct 21, 2021 3:13PM ET
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Asma Abdul
Asma Abdul Oct 21, 2021 2:28PM ET
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should i buy oil or sell
Punter Baaz
Punterbaaz Oct 21, 2021 2:28PM ET
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For what purpose are you looking to buy or sell oil?
Billy Foos
Billy Foos Oct 21, 2021 2:28PM ET
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I shorted today
Nasser Hefny
Nasser Hefny Oct 21, 2021 2:28PM ET
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By by
Mohd Izhar Muslim
Mohd Izhar Muslim Oct 21, 2021 2:27PM ET
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Hopefully will be better always
Mark McMillan
Mark McMillan Oct 21, 2021 2:18PM ET
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it's a trap. Oil will reach near $100 per barrel before they are happy. USA should of never reduced production making us dependent on foreign oil. Huge mistake by Biden. FJB
Deborah Beal
Deborah Beal Oct 21, 2021 2:14PM ET
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please bring down the gasoline and heating oil prices! This is very inflationary to those with lower incomes.
Mark McMillan
Mark McMillan Oct 21, 2021 2:14PM ET
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Greedy have no sympathy for us and will make us pay as much as they can. It would take our sacrifice in reducing use before we can get them to lower prices.
Brook Buck
Brook Buck Oct 21, 2021 2:14PM ET
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reducing use like biking, walking and horses?
Lars Hellman
LarsH Oct 21, 2021 2:14PM ET
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Let them have Teslas and free DC.
Stephen Corsaro
Stephen Corsaro Oct 21, 2021 2:14PM ET
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that's not how it works. we have a fiat currency. debt equals wealth for the wealthy and inflation for the masses. inflation is the tax on debt that the wealthy own the IOUs for. they don't pay taxes and use that money to buy debt notes . now they collect interest on what they should be paying for taxes while retaining the principle. why do you think the Nixon administration went off the gold standard? the wealthy bought the US government and make the rules. the masses argue with each other about " what if the wrong side wins". the masses are lambs going to slaughter and thinking there are "sides".
 
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