NEW YORK, Oct. 5 (Xinhua) -- Oil prices extended gains on Tuesday after the Organization of Petroleum Exporting Countries (OPEC) and its allies, widely known as OPEC+, decided to gradually expand its oil production.
File photo: CGTN
The West Texas Intermediate for November delivery added 1.31 U.S. dollars, or 1.7 percent, to settle at 78.93 dollars a barrel on the New York Mercantile Exchange, after jumping 2.3 percent on Monday. Brent crude for December delivery increased 1.3 dollars, or 1.6 percent, to close at 82.56 dollars a barrel on the London ICE Futures Exchange, following a 2.5-percent rise in the prior session.
The U.S. crude benchmark notched its highest front-month contract finish since late October 2014, while Brent futures climbed to a three-year high, according to Dow Jones Market Data.
OPEC+ on Monday reconfirmed the production adjustment plan and the monthly production adjustment mechanism approved in July, and agreed to adjust upward the monthly overall production by 400,000 barrels per day for November.
The group is gradually easing record output cuts made last year and some analysts had expected that the alliance would expand its production to a greater extent to curb prices.
"In view of the significantly higher price level and the tight market situation, several market participants had been hoping for a more pronounced expansion of supply," Carsten Fritsch, energy analyst at Commerzbank Research, said Tuesday in a note.
"Even after the production hike that has been decided, the oil market is likely to show a sizeable supply deficit in the fourth quarter because oil demand is considerably more robust than anticipated," he added.
