Latest Oil Price News: Oil prices surge ahead of OPEC meeting

Oil prices climbed 4% on Monday ahead of scheduled OPEC meeting this week.

Crude on the rise ahead of OPEC
Source: Bloomberg

Analysts predict this week could be a big week for oil markets with the Organization of the Petroleum Exporting Countries (OPEC) meeting scheduled in a few days.

It is expected the outcome of this week’s OPEC meeting will result in a supply cut, which would be aimed at reining in emergent oversupply.

While there have been no official announcements detailing a supply cut, most analysts expect a reduction of 1-1.4 million barrels per day (bpd).

US oil producers continue to produce record amounts of oil, with crude output at a record level of more than 11.5 million bpd.

IG Market Analyst, Kyle Rodday says the news post-OPEC meeting could be significant.

“If at this week’s OPEC meeting we receive confirmation that production cuts are coming the markets way, this may put some sort of a base under oil prices moving forward.” Mr Rodda said.

Oil Price

WTI futures were up more than 3% in response to the US-China trade truce. (WTI) crude futures were at $53 per barrel at time of writing, up $2.07 per barrel, and 4.1% from last close.

International Brent crude oil futures were up $2.18 per barrel, or 3.7%, at $61.64 a barrel.

The meeting between Trump and Xi has lifted sentiment according to Mr Rodda.

"This has flowed through to oil prices at this early stage of the week, primarily due to the pro-growth impacts of a de-escalation in the trade war." Mr Rodda said.

While crude oil has not been included in the US import tariffs, traders are taking advantage of the positive sentiment and driving crude markets.

Mr Rodda also says the G20 meeting proved Saudi and Russian relations were stronger than ever.

"There were subtle signals coming out of the G20 of greater co-operation between the Saudi’s and Russian’s regarding oil production cuts.

The key ingredient to curb global oil production is a consensus between Russia and the (effectively) Saudi led OPEC about where prices ought to roughly be." Mr Rodda said.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

Find articles by writer

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.