Oil extends gain as Opec crude production slips before meeting

Darnell Taylor
December 3, 2019

Many experts concur that the group, dubbed as OPEC+, should make deeper cuts to the current oil production level to boost crude oil prices.

Brent crude futures rose 76 cents, or 1.3%, to $61.25 a barrel by 0415 GMT.

US West Texas Intermediate crude was up 25 cents, or 0.5 per cent, at $56.21 a barrel.

Oil slipped below $56 as U.S. President Donald Trump said there may be a long wait for a trade agreement with China, casting doubt about the strength of demand just days before the OPEC+ meeting.

The Organization of the Petroleum Exporting Countries (OPEC) and allies including Russian Federation, known as OPEC+, are expected to at least extend existing output cuts to June 2020 when they meet this week.

"I have no deadline, no", Trump told reporters in London, where he was due to attend a meeting of North Atlantic Treaty Organisation leaders.

Saudi Arabia is pushing the plan to deliver a positive surprise to the market before the initial public offering (IPO) of state-owned Saudi Aramco, the sources said.

Kenney gains 'leverage in the federation' at premiers meeting
The premiers also avoided other divisive issues, such as carbon pricing and Quebec's controversial secularism law known as Bill 21.


OPEC and other major oil producers are expected to agree to deepen output cuts to 1.5 million barrels per day (bpd) to the end of 2020 from 1.2 million now to help reduce a global supply overhang, JPMorgan said in a note on Tuesday.

At the same time, a senior official at the International Energy Agency (IEA) said on Tuesday that OPEC producers are unlikely to agree to change their current deal on curbing output until the market outlook becomes clearer.

The investment bank said it expects Brent to trade around $60 a barrel in 2020 in the absence of geopolitical shocks.

But U.S. production keeps rising, filling the gaps left by OPEC, with output in September increasing to a new record of 12.46 million barrels per day (bpd), the U.S. government said in a monthly report on Friday.

USA crude inventories probably shrank by 1.5 million barrels last week, according to a Bloomberg survey.

Concerns about the inability of the United States and China, the world's two biggest oil users, to reach a preliminary deal to resolve their 17-month trade dispute also weighed on oil prices, along with discouraging U.S. economic data.

US crude oil inventories likely declined by 1.8 million barrels last week, according to six analysts polled by Reuters.

Other reports by

Discuss This Article

FOLLOW OUR NEWSPAPER