OPEC and allies including Russia continue to rubber-stamp the revival of more supply, resisting repeated calls from the US and International Energy Agency (IEA) to pump more oil.
The petroleum organisation stuck closely to its original plan, expecting to raise output by 432,000 barrels per day in May.
OPEC has been unwinding massive output cuts put in place as a result of the pandemic. Despite the Russia-Ukraine war and a prolonged underinvestment in new supply exacerbating tight market conditions, OPEC has insisted that no supply shortage exists.
OPEC announced that it will no longer use the IEA’s monthly Oil Market Report as a source of data on its members’ crude output.
Relations between OPEC and the Paris-based IEA have rapidly deteriorated as the two bodies hold diverging views over supply and climate change.
“OPEC delegates said the organisation felt the IEA's data has been tainted by anti-fossil fuel bias, particularly with the agency's net-zero roadmap which said all new upstream investment should stop if climate change is to be contained,” reported S&P Global.
Earlier this morning, US President Joe Biden authorised the release of 1m barrels a day from the Strategic Petroleum Reserve (SPR) for the next 6-months.
The Biden administration is considering the release of up to 180m barrels of oil from the Strategic Petroleum Reserve (SPR) to help cut gas prices and fight inflation.
The Biden Administration first considered the strategic release on Thursday morning, driving a sharp -4% decline in oil prices.
Local oil stocks like Woodside Petroleum (ASX: WPL) have started to trade sideways after a massive run-up between January and March.
Oil prices have been extremely volatile for the past few weeks as further escalation between Russia-Ukraine tends to drive further upside while peace talk progression tends to push prices lower.
Biden's strategic release has so far provided temporary reprieve to surging oil prices. However, the SPR release is simply a temporary solution.
Developments between Russia-Ukraine will continue headline oil price movements.
"If it becomes clear that a major de-escalation in the war is not going to happen, then oil could surge back to the recent highs," said Oanda senior market analyst, Ed Moya.
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