Oil prices fell this Monday, with the Brent falling to $80 a barrel, while investors are awaiting the meeting of the OPEC+ to be held later this week to reach a deal that is expected to curb supply until 2024.
Brent crude futures fell 42 cents, or 0.5%, to $80.16 a barrel by Monday morning, while U.S. West Texas Intermediate crude futures lost 49 cents, or 0.7%. %, at $75.05 a barrel.
Both contracts rose slightly last week, their first weekly rise in five weeks, boosted by expectations that Saudi Arabia and Russia extend voluntary supply cuts until early 2024 and for OPEC+ to discuss plans to further reduce production.
However, prices had fallen by mid-week after the Organization of Petroleum Exporting Countries and its allies, including Russia, They postponed a ministerial meeting to November 30 to iron out differences over the production objectives of African producers. The group has since moved closer to a compromise, four sources at the agency told Reuters on Friday. OPEC+.
ING analysts said market sentiment remains negative given the dispute within OPEC+ over production quotas, although they expect Saudi Arabia to extend its additional voluntary cut of 1 million barrels per day into next year.
Estimated exports from OPEC countries have fallen to 1.3 million barrels a day below April levels, analysts at Goldman Sachs in a note, in line with the group’s supply objectives.
However, the United Arab Emirates are set to increase exports of the iconic Murban crude oil early next year, according to traders and Reuters data. Meanwhile, in the United States, the increase in crude oil reserves could also put downward pressure on prices, according to analysts.
The International Energy Agency forecasts a slight surplus on global oil markets in 2024, even if the countries of the OPEC They extend their cuts until next year. Oil prices have also stabilized following the easing of geopolitical tensions in middle East following the ceasefire in Gaza and the exchange of hostages and prisoners.
The OPEC meeting
The OPEC+ is still negotiating ahead of its oil policy meeting this Thursday, sources said Monday, a meeting that analysts expect and some group sources say it will consider new production cuts to support the market.
The Organization of Petroleum Exporting Countries (OPEC) and a Russian-led alliance, known as OPEC+, will begin their meetings virtually to decide oil production levels at noon on Thursday, according to a draft agenda seen by Reuters on Monday.
The meeting It was delayed from November 26th. OPEC+ sources said this was due to a disagreement over the production levels for African producers, although some sources have since said that the group has moved closer to a compromise on this point.
Several analysts said they expect OPEC+ to expand or even deepen the supply cuts over the next year to support prices, which on Monday were trading at around $80 a barrel in the case of the benchmark Brent, far from the almost 98 dollars at the end of September. OPEC+ sources told Reuters earlier in the month that the group would study the possibility of further cuts.
On Thursday at noon the ministers of an advisory panel called Joint Ministerial Oversight Committee. Next, in the afternoon, it will be the turn of the group of OPEC+ ministers, according to the agenda.
Saudi Arabia, Russia and other OPEC+ members have already committed to cutting total oil production by about 5 million barrels per day (bpd), or about 5% of output. daily global demandin a series of measures that began at the end of 2022.
This includes additional voluntary cuts in production of Saudi Arabia of 1 million bpd that will expire at the end of December, and a cut in Russian exports of 300,000 bpd also until the end of the year.
Source: Ambito
