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Oil futures traded lower Thursday, with the U.S. benchmark pulling back from a seven-year high on suspected profit-taking a day after the Organization of the Petroleum Exporting Countries and its allies stuck with a plan to boost production by another 400,000 barrels a day in March.
West Texas Intermediate crude for March delivery
CL00,
CLH22,
fell $1.27, or 1.4%, to $86.99 a barrel on the New York Mercantile Exchange after eking out a small gain Wednesday for its highest finish since October 2014. April Brent crude
BRN00,
BRNJ22,
the global benchmark, was down $1.07, or 1.2%, at $88.40 a barrel on ICE Futures Europe.
The decision by OPEC+ to boost output by 400,000 barrels a day was seen as supportive, with the group continuing to resist pressure from the U.S. and big oil-consuming countries for a more aggressive boost. Meanwhile, OPEC+ has failed to raise output in line with past monthly increases.
Also, several OPEC+ representatives appeared to tie the recent rise in prices to tensions between Russia, a member of the group, and Ukraine.
“Pumping more oil onto the market just now will do little to change this in our view,” said Carsten Fritsch, analyst at Commerzbank, in a note. “It is more important to be able to supply more oil to the market if need be. And for this to be possible sufficient spare capacities are vital. Yesterday’s decision by OPEC+ makes sense to us, in other words.”
See also: Why OPEC+ can’t hit its oil production targets — and what it could do about it
