The Day at a Glance | october 3 2022

The Top

*OPEC+ considers decreasing crude oil production in more than 1M daily barrels; the largest cut since the pandemic.

*Presidential election in Brazil will go to second round.

*Truss`s governments scraps tax cut plan in the United Kingdom to fend off revolt.

*Regulators in China call on state banks to allocate 85 billion dollars to back the real-estate sector.

Economic environment

OPEC+ considers wide oil production cuts. According to a Wall Street Journal report published over the weekend, the Organization of the Petroleum Exporting Countries and its allies (OPEC+) is considering carrying out a 1 million daily barrels cut in oil production in order to counter the recent decrease in the commodity`s price. OPEC+ members will meet in Vienna on Wednesday in the organization`s first in-person meeting since 2020. If said cut is confirmed, this would be the largest since the pandemic and would reflect concern within OPEC+ regarding the global economic slowdown and its repercussions on demand for energy. The decision would completely scrap the US government`s requests to continue carrying out production increase to ease the global inflationary impact. Member countries have met on a monthly basis since 2021 to define crude oil production quotas in efforts to stabilize international prices; they will meet on October 5th to define November`s production. Russia has backed an aggressive production cut and Saudi Arabia has reaffirmed that the organization could cut supply; these are messages that reinforce the alliance between the two world`s largest oil producers. Oil prices logged increases in this week`s first trading session.

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