Fundamental analysis
29 August, 2022
Oil prices rose 1% on Monday, as expectations OPEC will cut output if needed to support prices, conflict in Libya, and rising demand amid soaring natural gas prices in Europe helped offset a dire outlook for growth in the United States. Heavy clashes in Libya's capital which killed 32 people on the weekend sparked concern that the country could slide into a full-blown conflict, which could again disrupt crude supply from the OPEC nation, they said. Both benchmark contracts had traded lower earlier in the day as the dollar climbed after Friday's blunt comments from Federal Reserve Chairman Jerome Powell that the United States faced a prolonged period of slow growth amid further rate hikes. Oil prices have been buoyed by hints from Saudi Arabia and other members of the Organization of the Petroleum Exporting Countries and allies, together called OPEC+, that they could cut output in order to balance the market. The United Arab Emirates is aligned with Saudi thinking on output policy, a source with knowledge of the matter told Reuters on Friday, while the Omani oil ministry also said it supports OPEC+ efforts to maintain market stability.
