Oil prices fall more than $1/bbl after OPEC+ delays meeting

SINGAPORE (ICIS)–Oil prices fell by more than $1/bbl on Thursday, extending losses in the previous session after OPEC and its allies delayed a meeting to discuss whether to expand oil output cuts.

Product (in $/bbl)	Latest (at 02:41 GMT 23 November)	Previous	Change
Brent January	80.77	81.96	-1.19
WTI January	76.06	77.10	-1.04

Oil is expected to trade with low liquidity due to the US Thanksgiving holiday. Both crude benchmarks have now fallen for four straight weeks.

OPEC on 22 November announced that it had postponed the meeting, originally scheduled for 26 November, to 30 November.

“Several members are reportedly unhappy about their production targets for next year, levels which were announced back in June. This is specifically the case for Angola, Congo and Nigeria, who had their production targets cut since they struggled to hit their 2023 targets,” Dutch banking and financial services firm ING said.

Disagreement between members will likely increase volatility within the market over the course of the next week, it said.

“It is unclear how this will affect broader policy, or whether it could have any impact on Saudi Arabia extending its additional voluntary cut of 1m bbl/day into early 2024,” ING said.

Adding to the downside price pressure was weekly data from the US Energy Information Administration, which showed a weekly gain of 8.7m barrels in US crude inventory to their highest since July this year.

Commercial crude stocks, excluding the Strategic Petroleum Reserve (SPR), were 448.1m barrels, 1% below the five-year average for this time of year.

US producers left the number of oil drilling rigs unchanged this week, according to energy services firm Baker Hughes.

The announcement that Israel might agree to a four-day ceasefire in return for the release of hostages held by Hamas positively influenced the outlook on easing tensions in the Middle East.

However, the market has already taken into account the likelihood that the ongoing conflict would not escalate beyond Israel’s borders.

Thumbnail photo shows a Singapore oil tanker at Zhoushan port in China (Source: Top Photo Corporation/Shutterstock)

Focus article by Nurluqman Suratman