Saudi Arabia: Oil prices rise in January on improved outlook for global economic growth
The OPEC oil basket traded at USD 81.6 per barrel in January on average, up 2.4% from the prior month. Meanwhile, on 2 February, the latest date with data available, the price was 1.1% lower on a year-to-date basis and 10.6% lower than on the same day last year.
Crude oil prices rose over the last month largely due to Chinas reopening from Covid-19 and lesser pessimism about global economic growth this year.
According to a survey by Reuters, the combined crude oil output of OPEC members fell slightly to 28.87 million barrels per day (mbpd) in January from 28.93 mbpd in December. This mostly reflected lower output in Iraq.
Looking ahead, our panelists see OPEC oil output as rising by the end of this year. However, Saudi output is likely to stagnate, as it is already producing near its quota level. This is likely to hit real GDP growth this year, despite the boost to government coffers from the upward pressure applied to crude prices by lower oil supply.