Oil prices rise on OPEC output cut hope; Russia price caps in focus

Oil prices rose on hopes of a discussion about production cuts at the OPEC’s meeting this month, while gold prices were on track for their third weekly decline.

Shreyansi Singh

Updated Sep 2, 2022, 16:00 IST

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KEY HIGHLIGHTS

G7 finance chiefs to discuss a Russian oil price cap
OPEC meeting in focus
All eyes on U.S. non-farm payrolls data

Mumbai: Oil prices rose on Friday on expectations of a discussion about output cuts at the OPEC’s September meeting, while fears of weak global growth capped gains.

The Organization of the Petroleum Exporting Countries (OPEC and allies, together called OPEC+), are scheduled to meet on September 5 against the backdrop of weak demand.

Top producer Saudi Arabia has said that supply remains tight and production cuts are on the cards.

OPEC+ cut its outlook for demand and expects demand to fall short of supply by 400,000 barrels per day (bpd) in 2022. The group expects the base case for a market deficit of 300,000 bpd for 2023.

Group of Seven finance ministers are expected to finalize plans of imposing a price cap on Russia with an aim to slash revenues for Moscow’s war in Ukraine.

Britain's Finance Minister Nadhim Zahawi said that he was hopeful that G7 finance ministers will "have a statement that will mean that we can move forward at pace to deliver this."

China doubled down on coronavirus restrictions, while Sweden’s Volvo cars closed its factories in China due to curbs.

A conclusion to negotiations on a revived nuclear deal with Tehran has declined after the U.S. rejected Iran’s proposal as “not constructive”.

The Biden administration gave Iran’s proposal a provisional, but abrupt, thumbs down minutes after it was received by the European Union and passed to Washington.

Gold edges up, set for 3rd straight weekly loss

Gold prices rose on Friday, propped up by a subdued dollar, but bullion was on track for a third straight weekly loss on bets of a continuation of the Fed’s aggressive stance on interest rate hikes.

U.S. non-farm payrolls data due at 1230 GMT, is expected to show strength in the labour market, helping the case for a 75-basis-point rate hike this month.

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