It should be noted that these discussions take place in a context in which the United Nations COP28 climate summit opens in the United Arab Emirates, an OPEC member country.
the negotiations in the OPEC+ are defiant, which resulted in the postponement of the meeting scheduled for November 26.
The leaders of the Organization of Exporting Countries Petroleum and his allies, known as OPEC+, are immersed in intense negotiations to establish significant cuts in crude oil production, seeking to balance the global oil market. are expected to reduce at least 1 million barrels per day (bpd) by early next year.
The main drivers of this measure are Saudi Arabia and Russia, who are leading discussions to extend the current cuts. Riyadh has maintained a voluntary cut of 1 million bpd since July, and this reduction is expected to continue. Besides, additional contributions are anticipated from other member countries to reach the collective goal of more than 1 million bpd.
In this context, crude oil prices Brent show an increase in anticipation of these cuts, exceeding US$83 per barrel (1.3%). However, concerns remain due to the projected slowdown in economic growth by 2024, as well as expectations of oversupply in the market. WTI oil climbs to US$79.05 or (1.5%).
Although a preliminary agreement has been reached, it has not yet been determined the exact contribution of each member. It is speculated that this figure could vary and will depend on the decisions of the participants in the meeting.
With current Saudi and Russian cuts due to expire later this year, attention is turning to plans for 2024. The possibility of further cuts is being discussed that could take between 1 million and 2 million bpd off the market in the first quarter of 2024.
Oil: the data analyzed by the market
Helima Croft, RBC analyst Capital Marketsnotes the possibility of a coalition between Russia and Saudi Arabia to extend the cuts through the first quarter of 2024, rather than Saudi Arabia taking on new cuts on its own.
The International Energy Agency (IEA) forecasts a slowdown in oil demand by 2024, attributed to a slowdown in the post-pandemic economic rebound, advances in energy efficiency and the expansion of electric vehicles.
The negotiations in the OPEC+ are defiant, which resulted in the postponement of the meeting scheduled for November 26. An OPEC-only virtual meeting of ministers is currently planned, followed by a broader OPEC+ meeting.
The delay is partly due to disagreements over production quotas for African producers, a topic that has been largely addressedaccording to sources.
It should be noted that these discussions take place in a context in which the climate summit is inaugurated United Nations COP28 in United Arab Emiratesan OPEC member country.
Source: Ambito
I am a 24-year-old writer and journalist who has been working in the news industry for the past two years. I write primarily about market news, so if you’re looking for insights into what’s going on in the stock market or economic indicators, you’ve come to the right place. I also dabble in writing articles on lifestyle trends and pop culture news.
