Oil Rises Toward $74 as OPEC+ Crisis Thwarts Bid to Raise Output

  • Biden team spoke to Saudis, UAE on negotiations, crude prices
  • Saudi Aramco boosts official selling prices to Asia for August

(Bloomberg) –Oil climbed toward $74 a barrel as investors tracked the high-stakes impasse between Saudi Arabia and the United Arab Emirates that’s stymied efforts to raise OPEC+ production amid a resurgence in demand.

West Texas Intermediate was 0.3% higher in Asian trading after closing down 2.4% Tuesday as a stronger dollar spurred a broad sell-off across the commodities complex. Before that pullback, the most-active prices had hit the highest intraday level since 2014 on concern the dispute at the cartel would stop more crude from being restored to the market. White House Press Secretary Jen Psaki said that U.S. officials have been speaking to both sides.

Oil has soared in 2021 as the rollout of coronavirus vaccines permits major economies to reopen, spurring a revival in global consumption. While the Organization of Petroleum Exporting Countries and its allies have restored some of the production they took offline at the height of the pandemic, they can’t now agree on a way forward. Unless a compromise is forged, that means OPEC+ supply may not increase in August, further tightening the market.

As the dispute plays out, Saudi Arabia raised prices for buyers worldwide. In its main market of Asia, Saudi Aramco increased the official selling price for Arab Light crude by 80 cents a barrel to $2.70 above the regional benchmark. That’s the biggest on-month gain since January, and suggests the oil giant won’t rai

JPMorgan Chase & Co. is among banks that expects a deal will be found. OPEC+ is expected to eventually agree in the coming weeks to boost production by 400,000 barrels a day each month for the rest of 2021, according to a note.