​​By Barani Krishnan

Investing.com – Oil prices broke well beyond $80 per barrel on Monday as bulls in the market cheered OPEC+’s decision to add only incrementally to its production despite the squeeze in global supplies and worsening inflation by the day.

Prior to Monday’s meeting of the 23-nation alliance of oil producers, there had been speculation that it could agree to adding more than the 400,000 barrels per day it had committed to until the end of April. 

After the meeting between the Saudi-led Organization of the Petroleum Exporting Countries (13 members) and 10 producers, Russia’s message was clear. It would be the same 400,000 barrels per day for the next six-months, barring any changes.

The matter was not addressed in an official statement. But a Saudi official told the Wall Street Journal that “the kingdom is comfortable with the current price range and feels it won’t weigh on demand for oil”. 

No OPEC delegate directly addressed the White House or India, the world’s third largest oil importer, which had been clamoring for higher supplies to reduce oil prices and ramping inflation.

The deal came at a time when OPEC+ seems to have complete control over an oil market which, just 18 months ago, seemed like it was in turmoil due to the Covid-19 demand destruction. 

From its first-ever negative pricing of $40 per barrel in April 2020, U.S. crude’s benchmark settled Monday’s trade at $77.62 per barrel, up $1.74 on the day or 2.3%. The session’s opening price hit $78.36, a new seven-year high. WTI gained 60% in this session alone.  

London-traded crude, the global benchmark for oil, finished Monday’s session at $81.26 per barrel, up $1.98 or 2.5%.  The session saw Brent reach an $81.98 peak. The price is now up 57%.

Although oil prices now seem different than they were during the pandemics, some OPEC delegates told journalists in private that they are concerned about the virus again depressing the prices.