Oil prices fall around 1% on delayed OPEC+ gathering
Oil prices have extended losses after talk that OPEC may not deepen production cuts next year. US crude stocks are building. IGTV financial analyst @AngelineOng looks at the dynamics behind the future moves in oil prices.
(Video Transcript)
Investors await new OPEC+ meeting date
Taking a look at oil for you, because oil is moving down roughly 1%, extending losses from the previous session. Here's a look at US crude for you. As you can see here, we're seeing quite a remarkable down channel from the highs seen back in September.
But what's also interesting as well is that there are now many parties talking about the group, perhaps not deepening the output cuts next year due to dissenting African members.
What's also key to look out for, just showing you a snapshot of Brent here, is that because the two tend to go in tandem, Bloomberg is reporting that there is no actual specified date for the delayed meeting. And this unspecified nature of the date could be prolonged.
The question now is what that all means. Of course, much of the talk surrounding oil has been on Russia and Saudi Arabia. Several analysts have predicted that Organization of the Petroleum Exporting Countries Plus (OPEC+) was likely to extend or even deepen oil supply cuts in the next year.
Saudi asks other members to share burden
Members prior to this had already pledged oil output cuts of around five million barrels a day, or around 5% of daily global demand in a series of steps that started back in 2022.
This figure includes a one million barrel per day voluntary reduction by Saudi Arabia and a 300,000 barrel per day cut in Russian oil exports, both of which last until the end of 2023.
Now, Saudi Arabia, if you recall, has repeatedly said it was dissatisfied with other members about their output numbers, and this time could be asking them to share the burden.
What I can tell you is that right now, we are seeing the Russian state-owned domestic news agency RIA saying on the Russian side, the Kremlin, and on the OPEC+ meeting for Spain, the Kremlin says that contacts and talks are ongoing, but there is no clear date yet.
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