Russia may propose 1 million b/d cuts, oil prices rebound 2% from months lows

U.
S.
oil futures rose 2% on September 27 to settle at $78.
50 a barrel
.
Earlier, Russia may propose OPEC+ to reduce production by about 1 million b/d at its next meeting, oil prices edged higher and traders were already preparing
for a bullish decision.
At the same time, investors are worried that Hurricane Ian may limit supply in the US Gulf of Mexico

On Tuesday (September 27), oil futures rose 2.
6%, settling at $86.
27 / barrel; The low of the last session fell as low as $83.
65, the lowest since
January.
Russia may propose that OPEC+ cut oil production by about 1 million b/d
at its next meeting in October, a source familiar with Russia's views said.
At the same time, the dollar's retreat from 20-year highs also helped support oil prices
.

In the week ended September 23, crude oil inventories surged by 4.
15 million barrels, refined oil inventories increased by 438,000 barrels and gasoline inventories fell by 1.
048 million barrels
, according to data released by the American Petroleum Institute (API).
Oil prices slipped $
0.
50 after the data was released.
Despite the gloomy outlook for global economic growth, crude oil supply could fall to levels consistent with demand as the world begins to enter the storage season and inventories increase
.
OPEC+ will meet on October 5, at which OPEC+ symbolically cut output by 100,000 b/d
.
Despite the weakening of oil prices, the spread between WTI and Brent crude has been strengthening
this month.
Tamas Varga, an analyst at PVM Oil Associates, said this suggests financial, rather than physical, demand is declining
.
Iraqi Oil Minister Ihsan Abdul Jabbar said OPEC+ was monitoring oil prices and hoped the market would strike a balance
.
Winter oil prices could reach $150/barrel
.
UBS analysts wrote in a note that OPEC+ cuts in oil production against the backdrop of recession fears and a stronger dollar are crucial
to break the downward momentum in oil prices.
If OPEC does not take action to withdraw oil from the market, it could further stimulate downward pressure
on oil prices.
The group will have to announce cuts of at least 500,000 barrels
per day in the coming days.
Crude oil prices fell because of fears that a recession would lead to weaker demand and improved supply in the oil market
.
The overall safe-haven environment triggered by aggressive monetary tightening in the United States and Europe also weighed
on oil prices.
U.
S
.
offshore oil producers said they were closely monitoring the trajectory of Hurricane Ian, a powerful storm that shut down about 11 percent of oil production in the U.
S.
Gulf of Mexico as it hit Florida.
Chevron said Monday it had shut down oil production
on some offshore platforms in the Gulf of Mexico as Hurricane Ian approached.
Bob Yawger of Mizuho Bank in New York said the shutdowns may only provide a brief respite for oil prices
.
I think these production losses will be made up soon, and the chances of a storm changing course and forcing more shutdowns are slim
.
After shutting down some offshore crude production, BP said the storm posed no threat to its Gulf of Mexico assets and that it was redeploying workers to oil platforms
.

(U.
S.
oil hourly chart)