Oil Prices Set For Large Weekly Loss Ahead Of OPEC+ Meeting On Supply
Oil prices are on track for their biggest weekly decline since late June, ahead of an OPEC+ meeting that’s expected to result in the return of more idled barrels, exacerbating concerns around oversupply.
Current Market Trends
Brent traded near $64 a barrel, down around 8% for the week, while West Texas Intermediate was below $61. The alliance is scheduled to meet online on Sunday to make a decision on output for November, and could discuss fast-tracking supply hikes as the group seeks to reclaim market share.
There are already early signs that global oversupply may be emerging in the Middle East, and the International Energy Agency expects the glut to swell to a record next year — in part due to the return of OPEC+ production. Some Wall Street banks predict Brent will slide into the $50s-a-barrel range.
OPEC+ Production Cuts
The Organization of the Petroleum Exporting Countries raised production by 400,000 barrels a day in September, formally unwinding output cuts made by the group and its allies in 2023, according to a Bloomberg survey. Saudi Arabia increased supply exactly in line with their OPEC+ quota for the month.
“We believe September marked a turning point, with the oil market now heading towards a sizeable surplus,” JPMorgan Chase & Co. analysts including Natasha Kaneva wrote in a research note.
Price Movements
Brent for December settlement rose 0.2% to $64.24 a barrel as of 8:26 a.m. in Singapore after sliding 1.9% on Thursday.
WTI for November delivery was 0.2% higher at $60.62 a barrel.
Impact On Indian Markets
Indian investors and traders should be aware of the potential impact of the OPEC+ meeting on the Indian stock market. A decline in oil prices could lead to a decrease in inflation, which could have a positive effect on the Indian economy.
Investment Strategies
Investors looking to capitalize on the potential decline in oil prices should consider diversification strategies to minimize risk. This could include investing in alternative energy sources or energy efficient stocks.
Conclusion
In conclusion, the OPEC+ meeting is expected to have a significant impact on the oil market, with potential declines in oil prices. Indian investors and traders should be aware of the potential impact on the Indian stock market and consider investment strategies to minimize risk and maximize returns.
