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Saudi Arabia Denies Boosting Production, Crude Oil Prices Rise

by Didimax Team

The prices of crude oil rose again yesterday. It is especially after Saudi Arabia stated that OPEC+ is still on their previous plan to cut the production for several goals. 

Those aims are to balance the concern about global recession and declining demands from Chinat. The Minister of Energy from Saudi Arabia, Prince Abdulaziz bin Salman on Monday  said his opinion. 

As it was quoted by SPA news office, the price denied any news from Wall Street Journal which said that OPEC is considering to add the productions so that oil prices have slumped for more than five percent. 

The crude oil prices are trying to survive as it is said by Naeem Aslam, an analyst from Avatrade. Saudi Arabia has denied any discussions due to raising the OPEC production.


The Members also denied the Rumor 

That country has denied that there are discussions about increasing OPEC production and its allies have helped the price recovery today. That must be known by all investors and market participants. 

The United Arab Emirates, OPEC's member oil producer that also includes major producers, also denied that there was talk of a change in the production cut deal by OPEC+. 

Kuwait also said there was not any plans or discourse to raise production. All members are having the same voice and statements due to the rumors spread within the people. 

OPEC, Russia and other producers which are grouped together as OPEC+, will meet again on December 4. It means a day before the effectiveness of European and G7 sanctions related to Russia's invasion of Ukraine.

G7 Will Still Allow the Shipments 

The condition above is likely to support the strengthening of oil prices. On December 5, the European Union will ban imports of Russian crude as it can be known from various releases. 

Meanwhile, the G7 plans to still allow shipments but those will be done at low prices. These updates are becoming a good news for several parties in the market. 

For now, fears of a drop in crude oil demand from China related to Covid and a planned rate hike by the Federal Reserve become an issue that avoid the strengthening crude oil prices

Elsewhere, the US dollar was weakening again on Tuesday. The cause was market participants who ignored any concerns related to the COVID-19 cased in China. 

Euro is 0.6% Stronger to USD

The ignorance like that pushes the risk sentiment so that it is raising again. The improvement in the market's risky appetite is enough to withstand the strengthening of the USD.

Meanwhile, the release of the minutes of Federal Reserve meeting will be announced tomorrow. That statement was said by Joe Manimbo, a senior analyst in Washington.

The USD has strengthened against several major world currencies so far this year. That was supported by aggressive moves by the Federal Reserve (Fed) in raising interest rates to cope with inflation. 

However the recent slowdown in America's inflation data has led markets to speculate something. People believed that the Fed will slow down in raising its interest rates.

Central Bank must Push the Inflation 

Just like other representatives, the Cleveland Fed President Loretta Mester yesterday asserted that suppressing inflation is critical for the central bank. Some actions need to find in order to realize that. 

Meanwhile, the market will look forward to the minutes from Federal Reserve meeting that has been held in November. The goal is to find any clues about the next direction of interest rates.

The return of market risk appetite happened lately  has supported the Australian dollar's gain by 0.6%. The same trend is also happened to the New Zealand dollar. 

That currency was 0.9% higher as the market waits for a rate hike by the RBNZ. Sterling also rose by 0.6% so far. 



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