Oil prices rise as market monitors OPEC+ policy, geopolitical tensions

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U.S. crude and the global benchmark have rallied about 20% and 16% this year.

A pumpjack is shown outside Midland-Odessa area in the Permian basin in Texas, U.S., July 17, 2018. Image taken July 17, 2018.Crude oil futures rose on Wednesday, adding to a recent streak of gains after an OPEC+ committee meeting ended without recommending changes to production policy.Some members of OPEC and its allies led by Russia, called OPEC+, are voluntarily cutting 2.2 million barrels per day of production through at least the second quarter.

U.S. crude and the global benchmark have rallied about 20% and 16% this year as improving economic growth expectations should push the oil market into a 450,000 barrel per day deficit in the second and third quarters, according to Bank of America. Crude oil gained this week on mounting geopolitical tensions. Ukraine continued its campaign of drone strikes against Russian energy infrastructure, hitting the country's third-largest oil refinery.

And OPEC member Iran vowed to respond against Israel, accusing the country of bombing its consulate in Damascus and killing seven officials of the Islamic Revolution Guards Corps. The escalating tensions between Israel and Iran have raised fears again of a wider war in the Middle East that could disrupt crude supplies.

 

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