Oil prices rise, Kuwait, Iraq back OPEC+ plan

Kuwait and Iraq support sticking to plans to raise oil output by 400,000 barrels per day (bpd) at an OPEC+ meeting on Thursday, as the U.S. called again for extra supply to cool rising prices.

Kuwait's oil minister Mohammad Abdulatif Al-Fares said on Monday that the OPEC member supports the plan to raise output, which would ensure adequate crude supply to balance the global market, state news agency KUNA reported. Iraq's state oil marketing company, SOMO, said on Saturday that the OPEC member sees raising output as already planned was sufficient to meet demand and stabilize the market.

U.S. President Joe Biden on Saturday urged major G20 energy-producing countries with spare capacity to boost production to ensure a stronger global economic recovery.

President Biden's statement is part of a broad effort by the White House to pressure OPEC and its allies to increase supply. Brent crude prices were trading at near $85 a barrel on Monday, despite China announcing a release of fuel reserves to increase market supply and support price stability in some regions. OPEC heavyweight Saudi Arabia has already dismissed calls for more oil supplies from the group, saying the oil market was well-supplied.

"Other than the potential for the market returning to surplus next year, the other factor holding back the group is the uncertainty over if and when Iranian supply could return to the market," bank ING said on Monday. Last week, Iran said talks with six world powers to try to revive a 2015 nuclear deal will resume by the end of November.

Oil prices rose on Tuesday as key producer group OPEC undershot its expected pace of output increases last month, while the world’s top oil consumer China ramped up operating rates to meet a spike in diesel demand.

“Crude prices still seemed poised to head higher, with some traders waiting for confirmation after both the EIA crude oil inventory shows demand for most products are headed in the right direction, while U.S. production is stable and with OPEC+ sticking to their gradual 400,000 bpd increase plan,” said Edward Moya, senior analyst at OANDA.

Oil rallied to multi-year highs last week, helped by a post-pandemic demand rebound and the Organization of the Petroleum Exporting Countries and allies led by Russia, or OPEC+, sticking to gradual, monthly production increases of 400,000 barrels per day (bpd), despite calls for more oil from major consumers.

The increase in OPEC’s oil output in October fell short of the rise planned under a deal with allies, a Reuters survey found on Monday, as involuntary outages in some smaller producers offset higher supplies from Saudi Arabia and Iraq.

OPEC pumped 27.50 million barrels per day (bpd) in October, the survey found, a rise of 190,000 bpd from the previous month but below the 254,000 increase permitted under the supply deal.