Global crude oil prices are now continuing to decline with Brent oil heading towards $80 a barrel as investors await the OPEC+ meeting this weekend to draft a supply control agreement for 2024.
Brent crude was down 39 cents (0.5%) to $80.19 a barrel and US West Texas Intermediate crude was also down 44 cents (0.6%) to $75.10.
However, both of these contracts rose slightly in the past week. The first week's gains were supported by predictions that Saudi Arabia-Russia will launch voluntary supply cuts until early 2024 and that OPEC+ may discuss plans to further cut supplies.
Last week, oil prices began to show a decline after the Organization of the Petroleum Exporting Countries and their allies including Russia (OPEC+) postponed a ministerial meeting to November 30 to resolve the problem of differences in the morning targets of African producers.
According to ING analysts, market sentiment remains on the negative side as the dispute in OPEC+ over production quotas is still pending. Meanwhile, Saudi Arabia expects to roll out its additional voluntary cuts of 1 million barrels per day next year.
Goldman Sachs analyst Bula said that ahead of the OPEC+ meeting, it is estimated that crude oil exported by OPEC+ countries will decline 1.3 million barrels per day below the April level.
The United Arab Emirates (UAE) plans to increase Murban crude oil exports by early next year following the new OPEC+ mandate and refinery maintenance.
The International Energy Agency predicts a slight oil market surplus in 2024 even as countries in the group extend cuts.
As predicted, oil prices will stabilize after geopolitical tensions subside in the Middle East following a cease-fire in Gaza to make room for hostage and prisoner exchanges.
