Oil rises to $76 as OPEC+ postpones production supply decision

Crude oil prices rose on Monday ahead of another meeting of the Organisation of the Petroleum Exporting Countries and allies (OPEC+) for possible agreement on a gradual production increase.
Brent crude, the international benchmark, traded at $76.44 per barrel at noon on Monday with a 0.34 per cent increase.
The US West Texas Intermediate (WTI) crude also went up by 0.39 per cent to $75.45.
On Thursday, members of OPEC+ were reportedly expected to agree to a deal backed by Saudi Arabia and Russia that would further unwind previously agreed output curbs by allowing production to rise by 400,000 barrels per day every month from August to December — putting an additional two million barrels per day of crude into the market over the remainder of 2021.
The deal would also extend the duration of broader cuts that the group agreed to in 2021.
However, the United Arab Emirates (UAE) objected to the plan.
Reports said the UAE “unconditionally” supported an increase in production. But the country said the extension should be conditional on revising the so-called baseline, which determines how much a country is allowed to pump.
The UAE wants its baseline to be revised before extending those cuts till end of 2022, because it wants to produce more than it is now allowed based on the quota of its current baseline.
All OPEC+ agreements require unanimous approval.
The meeting was postponed to Friday but members failed to reach an agreement on its output policy and agreed to meet again on Monday (today).
Oil prices have surged more than 45 per cent in the first six months of 2021, with demand rising as global economies reopened.
“The issue is putting a condition on that increase, which is the extension of the agreement,” Suhail Al Mazrouei told CNBC’s Hadley Gamble, adding that the current proposal simply “wasn’t a good deal” for the UAE.
The current baseline set for the UAE was taken from October 2018, when it was producing around 3.2 million barrels a day. Last year, the number jumped to 3.8 million barrels per day