SULAIMANI (ESTA) — Oil prices fell on Monday, amid investor jitters ahead of a meeting of OPEC+ to decide whether to extend output cuts to balance global markets.
Brent crude futures dropped 70 cents, or 1.45%, to $47.48 a barrel by 0608 GMT, while U.S. West Texas Intermediate crude futures fell 72 cents, or 1.58%, to $44.81 a barrel.
However, both benchmarks are still set for a rise of more than 20% in November, the strongest monthly gains since May. Prices were boosted by hopes for three promising coronavirus vaccines to limit spread of the disease.
Analysts and traders also expect OPEC and allies including Russa – the OPEC+ grouping – to delay next year’s planned increase in oil output as a second wave of COVID-19 has hit the global fuel demand, Reuters reported.
OPEC+ previously agreed to raise output by 2 million barrels per day (bpd) in January after record supply cuts this year.
“While we base-case a 3-month delay to prevent a return to a global oil surplus through 1Q21, not all producers appear onboard,” Reuters quoted Goldman Sachs analysts as saying.
The winter wave of infections is expected to crimp global oil demand by 3 million bpd, they said, which would only partially be offset by heating and restocking demand in Asia.
ANZ estimated that the oil market surplus could run as high as 1.5 million to 3 million bpd in first half of 2021 if OPEC+ did not extend cuts.
(Esta Media Network/Reuters)
