WTI trades above $77.00 as OPEC+ agreed to extend its output cuts into 2025

West Texas Intermediate (WTI Oil price grapples to halt its three-day losing streak, trading around $77.10 per barrel during the Asian hours on Monday. Reuters reported on Sunday that the Organization of the Petroleum Exporting Countries and its allies, including Russia (OPEC+), agreed to extend its Oil output cuts into 2025 to support the prices amid sluggish demand growth. OPEC+ decided to prolong the cuts of 3.66 million barrels per day (bpd) until the end of 2025 and extend the cuts of 2.2 million bpd by three months until September 2024.

On Friday, US Personal Consumption Expenditure (PCE) data indicated that price pressures eased in April. Despite this, the report did not prompt a rate cut from the Federal Reserve (Fed), suggesting that the central bank may need more time to achieve its inflation goals. The higher interest rates are negatively impacting the United States's (US) economic outlook and dampening the demand for liquid Gold.

Last week, Federal Reserve (Fed) officials communicated that the central bank might maintain its restrictive policy for an extended period to achieve its 2% inflation target. Atlanta Fed President Raphael Bostic remarked in an interview with Fox Business that the inflation outlook will decline very slowly and emphasized the need for the Fed to remain in a restrictive stance. Additionally, New York Fed President John Williams stated that although inflation is still too high, he believes the current Fed policy is appropriately positioned to gradually bring price growth back to the Fed's target.

Israeli Prime Minister Benjamin Netanyahu's administration reluctantly accepted US President Joe Biden's proposal for a Gaza cease-fire on Sunday. This decision comes amid ongoing attacks in Rafah following intense Israeli airstrikes over the weekend, according to the BBC. Investors will closely watch the developments in these geopolitical tensions, as any signs of escalating risks could potentially drive up crude Oil prices.