As investors anticipated the OPEC+ meeting later this week in hopes of reaching an agreement to limit supplies through 2024, oil prices were little moved on Monday, with Brent remaining above $80 per barrel. U.S. West Texas Intermediate crude futures were up 10 cents, or 0.1%, at $75.64 a barrel, while Brent crude futures up by 12 cents, or 0.2%, to $80.70 a barrel.
Expectations that OPEC+ would discuss plans to reduce further and that Saudi Arabia and Russia could extend its voluntary supply cuts into early 2024 supported a modest increase in both contracts last week, marking their first weekly rise in five. The Organization of the Petroleum Exporting Countries (OPEC+) and their allies, notably Russia, postponed a ministerial meeting until November 30 in order to resolve disagreements over output targets for African producers, which sent prices down in the middle of last week.
Four OPEC+ sources told Reuters on Friday that since then, the group has advanced towards a deal. “We still expect an extension of the unilateral Saudi and Russia cuts through at least 2024Q1, and unchanged group cuts, although a deeper group insurance cut is likely on the table,” analysts at Goldman Sachs wrote in a note. In keeping with the group’s supply targets, the estimated exports of OPEC members have decreased to 1.3 million barrels per day below levels in April, they stated, ahead of the OPEC+ summit.
Notwithstanding, traders and Reuters statistics indicate that the United Arab Emirates is prepared to increase exports of its flagship Murban crude early in the upcoming year due to refinery maintenance, a new OPEC+ mandate, and barrels that are diverted to the foreign market. OPEC+ countries may continue to reduce production into next year, but even in that case, the International Energy Agency said it anticipates a little excess in the world’s oil markets in 2024.
