Oil prices rebound sharply on smaller-than-feared OPEC+ output hike

Investing.com-- Oil prices climbed sharply in Asian trading on Monday, rebounding from heavy losses last week, after OPEC+ agreed to a smaller-than-expected production increase for November that eased some market fears of a global supply glut.

As of 21:06 ET (01:06 GMT), Brent Oil Futures expiring in December jumped 1.4% to $65.45 per barrel, while West Texas Intermediate (WTI) crude futures climbed 1.5% to $61.78 per barrel.

Both benchmarks had slumped more than 8% last week, their steepest weekly drop in nearly three months, as traders braced for the possibility of a large OPEC+ hike.

OPEC+ agrees to a modest Nov hike

At its meeting on Sunday, the producer alliance said it would raise output by 137,000 barrels per day (bpd) in November, matching the increment approved for October.

That fell well short of the up to 500,000 bpd increase some market participants had anticipated, a prospect that had driven last week’s sell-off.

The decision provided relief to traders who had feared a flood of new barrels would overwhelm fragile demand. The group, which has already added more than 2.7 million bpd of supply this year, has been gradually unwinding the record cuts put in place during the pandemic.

Oil markets remain under pressure from rising U.S. shale production and a subdued global economic outlook. Concerns over weakening industrial activity in Europe and Asia, alongside a strong dollar, have weighed on demand expectations in recent weeks.

The alliance will meet again on Nov. 2 to reassess its strategy and adjust quotas if needed.

Gaza peace talks in Egypt in focus

Geopolitical tensions also remained in focus. In the Middle East, U.S. President Donald Trump said on Sunday that “very positive discussions” had taken place with Hamas, adding that technical teams would meet in Egypt on Monday to push forward Gaza peace talks.

Delegations from Israel and Hamas are expected in Sharm el-Sheikh for indirect negotiations centred on hostages, withdrawal and future governance.