Oil Dips After OPEC+ Headlines

Next week’s much-anticipated OPEC+ meeting in Vienna has now been moved to a virtual meeting but, as Amena Bakr noted, this does not mean its a nothingburger…

Don’t underestimate virtual meetings, the biggest cut in history was agreed on in a virtual meeting (2020) #OOTT #opec

— Amena Bakr (@Amena__Bakr) November 29, 2022

Reuters is reporting that, according to five sources among the delegates, OPEC+ is “likely to stick with the existing oil output policy” but also noted that the group “could consider further reducing oil-output”.

The reaction by the market is negative for now, suggesting the focus is on the ‘existing policy’ rather than “more cuts” as we note that out of 16 traders and analysts surveyed by Bloomberg this week, 10 anticipated a new supply cutback, with estimates ranging from 250,000 to 2 million barrels a day.

…so will we see a production cut now that OPEC+ has tested market reaction to maintaining current policy?

OPEC with 2 market tests in past 24 hours. Now has full visibility of positioning

— zerohedge (@zerohedge) November 29, 2022