Oil prices fell more than 1% today and are set to continue their decline after OPEC+ reportedly postponed its ministerial meeting. This led to speculation that producers may cut crude oil production to a lesser extent.
Brent crude lost $1.04 (1.3%) to $80.92 a barrel after falling 4% last Wednesday. U.S. crude oil West Texas Intermediate fell 90 cents (1.2%) to $76.20 after falling 5% in the latest session.
Even more surprising, the Organization of the Petroleum Exporting Countries (OPEC) and its ally, Russia postponed the ministerial meeting on November 30 where they will discuss the reduction of oil production.
Producers are taking a long time to agree on output levels and are likely to further reduce ahead of a meeting originally set for November 26, according to OPEC+ sources.
Three OPEC+ sources suggested that issues should be linked to African countries because they are smaller producers and reduce investor concerns.
Analysts predict Angola, Congo and Nigeria are targeted to increase their 2024 supply quotas to exceed the provisional level agreed by OPEC+ at its June meeting.
According to Analyst Helima Croft at RBC Capital Markets, OPEC discussed increasing the UAE's quota by reducing targets for African countries based on their production performance.
Angola and Congo have produced below the 2024 production target. Meanwhile, Nigeria has increased production above target due to improved security conditions in the Niger Delta.
Questions about OPEC+ supply arose as US crude oil stocks rose by 8.7 million barrels last week, exceeding analysts' expectations of 1.16 million. Baker Hughes reported that US oil rigs remained unchanged this week.
Meanwhile, about 3% of crude oil production in the Gulf of Mexico or nearly 61,165 barrels of daily production was shut down due to an underwater pipeline leak.
