Prices of crude oil have seen yet another increase on Monday following the collective decision from Organization of the Petroleum Exporting Countries along with a few of non-affiliated producer allies on Friday to impose production cutdown starting January of next year.
International Brent crude oil futures, for example, are now at $62.02 per barrel, which is up by 35 cents or .6 percent compared to the previous trading rate, the report from Reuters said.
A different scenario is happening on the US West Texas Intermediate (WTI) crude futures as it dropped 12 cents from last settlement to $52.59 a barrel.
What transpired behind is the incessant increase of American oil supply into the world market. US crude industry has already made it clear that they won't be taking part in the collective output cutdown.
The eventual upsurge of prices on Friday has already been seen by analysts and experts. OPEC and its non-member partners like Russia have earlier announced of their plans to reduce oil supply by a total of 1.2 million barrels per day (bpd). Majority of the cut would be done by OPEC members, particularly one of its major players, Saudi Arabia. The rest of the figure will be answered by non-OPEC countries.
Traders also attributed the continuous price hike to the closing of the 315,000 bpd-producing El Sharara oilfield in Libya.
Crude supply curbs will be implemented from January, measured against October 2018's yield.
This recent turn of events, however, doesn't guarantee a similar scenario for next year as an impending economic slowdown has already been expected by some of market analysts and watchers, the news agency went on to add.
Still, there's a fat chance that oil prices by 2019 will settle around $70 per barrel level. A forecasted price reduction of at least $6 per barrel should nevertheless be expected as markets like Bernstein Energy, has lowered its demand for crude oil from 1.5 million bpd previously to 1.3 million bpd for next year.
A different take was made by banking and finance institutions like US bank Morgan Stanley which stipulated that the cut will likely to result for Brent to peak at $67.5 per barrel by the second quarter of 2019, down from $77.5 bpd of the same term from last year.
According to Stanley, the move from OPEC was deemed necessary to prevent the inflation of crude inventories which could possibly crush down prices even further.
Oil prices began falling sharply beginning October of this year as signs of an impending economic slowdown surfaced.
