Oil prices fall for 5th consecutive day as OPEC+ meeting looms

November 28, 2023 (MLN): Global oil prices fell on Tuesday, extending losses for the fifth straight session as investors awaited this week's OPEC+ meeting and expected curbs on supplies into 2024.

Brent crude is currently trading at $79.75 per barrel, down by 0.26% on the day.

While West Texas Intermediate crude (WTI) is trading at $74.84 per barrel, down by 0.25% on the day.

The consecutive decline in oil prices came after the OPEC+ delayed a ministerial meeting last week owing to disagreements among members regarding production, thereby creating uncertainty about output cuts.

OPEC+, which combines the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, will hold an online ministerial meeting on November 30 to discuss production targets for 2024, as Reuters reported.

The meeting comes amid a sharp decline in oil prices, due to concerns that the market was oversupplied despite output cuts by the OPEC+.

Brent has fallen by more than 18% and WTI by over 21% since end-September highs. Strong production by non-OPEC countries such as the United States has added pressure on prices.

OPEC+ set oil prices tumbling last week by postponing its meeting in order to iron out disagreements over production targets for African producers.

However, it has moved towards a compromise, four OPEC+ sources told Reuters on Friday, potentially helping the group's de facto leader Saudi Arabia find consensus on the need to deepen output cuts.

The decline in prices could spare Riyadh any pressure from the U.S. to limit output cuts, according to analysts.

"Saudi Arabia may be comforted that US gasoline prices have fallen for 60 straight days. This may soften the US opposition to any move to tighten oil markets and support prices," ANZ Research said in a note on Tuesday.

The U.S. dollar's retreat to its lowest level in three months should bolster demand from countries who pay for their oil in other currencies.

Copyright Mettis Link News