Demand outlook improves, major oil producers maintain plans to increase output

According to the OPEC statement, the participating oil-producing countries reconfirmed the production adjustment plan and monthly production adjustment mechanism approved at the 19th ministerial meeting, and decided to increase the monthly total production in February this year by an average of 400,000 barrels per day according to the original schedule

The OPEC statement downplayed the impact of the mutated Omicron strain of the new coronavirus, arguing that the impact was mild and short-lived and did not hit oil demand hard

Despite the recent surge in the number of infections of the Omicron strain, many European countries have not adopted large-scale lockdown measures to avoid the epidemic hindering the economic recovery process

ING said the Omicron strain is more contagious but less lethal, helping to ease some concerns about oil demand

OPEC and non-OPEC oil producers are scheduled to hold their 25th ministerial meeting on February 2 to assess market conditions and decide on output levels next month

The latest decision of major oil-producing countries is in line with market expectations, pushing international oil prices to resume their gains

Analysts believe that in addition to easing market concerns about the epidemic and boosting demand expectations, geopolitical uncertainties such as tightening relations between Russia and Ukraine and negotiations on the Iranian nuclear issue are expected to provide support for international oil prices in the coming period

Joe Perry, a senior analyst at foreign exchange brokerage Jiasheng Group, said that the United States and other countries released crude oil reserves in December 2021 in response to rising oil prices, and may soon need to replenish inventories to further boost demand

　　Edward Moya, a senior market analyst at Anda, an online foreign exchange trading platform, believes that for some time to come, the price of Brent crude oil futures is expected to remain in the range of $80 per barrel, and the price of crude oil futures in New York is likely to consolidate at the level of $77 per barrel

　　Global oil demand is expected to return to pre-pandemic levels by the end of 2022, OPEC Secretary-General Haysam Geis said

　　Due to the impact of the new crown epidemic on oil demand, OPEC and non-OPEC oil-producing countries reached an agreement to reduce production in April 2020