Global oil prices fall 1% with the postponement of the OPEC+ meeting

Global oil prices fall 1% with the postponement of the OPEC+ meeting

After announcing the postponement of the OPEC+ ministerial meeting to November 30, oil prices dropped by over a dollar.

The price of Brent crude fell by $1.04 on Thursday to $80.92.

OPEC’s announcement, which caused a significant decline in oil prices, was unaccompanied by any explanation. Brent and West Texas Intermediate crude oil lost more than 4% on Wednesday evening.

The current strategy of the alliance, which includes the 13 OPEC members and ten other non-OPEC producing countries led by Russia, still needs to achieve sustainable price increases.

The Minister of Energy in Saudi Arabia has recently blamed speculators for the drop in oil prices and called it “incompatible with the market’s foundations.” However, the Russian Deputy Prime Minister Alexander Novak stated that the current oil prices reflect the current situation and are sufficient, making the market balanced. He also added that these issues would be discussed in detail at the next meeting.

Are there additional discounts?

Many analysts anticipate that OPEC+ will extend or increase oil supply cuts next year.

Before the meeting was postponed, Bloomberg reported that Saudi Arabia expressed dissatisfaction with other members’ production numbers, citing unnamed delegates who said the meeting might be postponed indefinitely.

Saudi Arabia, Russia and other OPEC+ members pledged to reduce oil production by 5 million barrels per day, about 5% of global demand, in steps starting in late 2022.

The text has been rewritten to clarify that both Saudi Arabia and Russia agreed to reduce their production and exports respectively.