The doubts around the agreement of largest oil countries for limiting the crude oil production continue to keep under pressure the commodity price, which fell by 0.6% yesterday. The Brent oil futures with December delivery lost another 0.2% today morning reaching a level of 51.34 USD per barrel, while WTI oil futures with December delivery dropped to 50.46 USD per barrel.
The OPEC meeting, which is scheduled for November 30, should reach an agreement for limiting the crude oil production and stabilizing of the commodity price. With approaching of this meeting, the prices will vary around the current levels, but speculations might cause some sharp changes on daily trading.
The OPEC has preliminary agreement to restrict the oil production in range of 32.5-33.0 million barrels per day, representing a decrease of about 1 million barrels per day. However, it is expected the Iran will not follow the cartel agreement and will restore the production to the level before sanctions. The oil production in Libya and Nigeria decreased during the last years due to the civil wars, but they probably will try to pick it up. Iraq also doesn’t agree to reduce production, due to high budget deficit, and will be excluded from the agreement in this direction.
However, countries outside OPEC agreed to support limiting of the crude oil production, as Russia and Saudi Arabia agreed with the principles of the agreement. Markets are waiting for any comments regarding the crude oil market and probably will be highly vulnerable during the next days.
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