Oil heading for third weekly drop on fears of weak demand

Oil heading for third weekly drop on fears of weak demand

The prices of Petroleum experience an increase this Friday, although they are heading towards the third consecutive week of declinesdue to signs of slowing demand and the focus on a key meeting of OPEC and its allies, which will determine the group’s next move in terms of production.

Brent crude futures rise 1.2% to $80.95. For its part, US West Texas Intermediate (WTI) crude oil futures increase 1.3% to US$76.75.

Despite these increases, both contracts are on track to close the week with a decrease of around 5%.

Oil: the OPEC+ decision

“Concerns about demand have replaced fears of production disruptions related to the Middle East conflict.”“says Commerzbank.

This week’s weak Chinese economic data intensifies concerns about weak demand. Additionally, Chinese refiners, which are the largest buyer of Saudi crude, have requested less supply for December.

The Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, They will meet on November 26 to establish production policy. Attention is focused on whether Saudi Arabia will extend a voluntary cut of 1 million barrels a day that expires at the end of this year.

“We believe the chances of Saudi Arabia extending its unilateral cut well into the first quarter of 2024 are increasing, given renewed market concern about Chinese demand and the broader macroeconomic outlook,” said Helima Croft, analyst at RBC Capital. Markets.

Citi analysts indicated in a note Thursday that they expect downward pressure to ease and prices to recover after falling to their lowest level since July earlier this week.

Source: Ambito

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