Brent oil futures were down 0.24% to $79.81 and crude oil WTI futures were down 0.22% to $76.83
Oil was down on Wednesday morning in Asia, with the Organization of the Petroleum Exporting Countries and allies (OPEC+) keeping its plan to increase supply for February 2022 as the fuel demand outlook brightens.
Brent oil futures were down 0.24% to $79.81 by 3:04 AM GMT and crude oil WTI futures were down 0.22% to $76.83.
As fears over the omicron COVID-19 variant continue to ease, OPEC+ agreed to a 400,000 barrel-a-day output increase for February on Tuesday. Russian Deputy Prime Minister Alexander Novak told the media that omicron’s spread is not impacting oil demand, thanks to the low level of hospitalizations.
But the cartel might not even hit the agreed number. Russia failed to raise output in December 2021, and fellow OPEC member Libya expects production to drop again this week. OPEC+ analysts also cut the first quarter’s surplus estimate and predicted weaker supply growth from rivals.
OPEC+ producers missed their targets by 730,000 barrels per day in October and by 650,000 barrels per day in November, the International Energy Agency said last month.
The overall supply-demand backdrop looks good for OPEC+, according to some investors.
Prices are heading higher after OPEC+ showed they are more confident that the global crude demand outlook will only take a limited hit, OANDA senior market analyst for the Americas Ed Moya told Bloomberg.
Geopolitical risks such as Russia-Ukraine tensions and the revival of the Iran nuclear deal could potentially support a higher oil price, he added.
Meanwhile, Tuesday’s U.S. crude oil supply data from the American Petroleum Institute showed a draw of 6.432 million barrels for the week ended Dec. 31.
Investors now await crude oil supply data from the U.S. Energy Information Administration, due later in the day.