OPEC’s policy meeting postponement drags Oil prices lower

Recent developments, such as the Middle Eastern ceasefire and a notable increase in US stockpiles, are causing oil prices to decline.

Following the release of the latest FOMC Minutes, which showed that all Fed’s policymakers decided not to change rates anytime soon, the US dollar has been strengthening as markets have become less enthusiastic about rate cuts. Higher yields and a stronger US Dollar Index could result from this.

Saudi Arabia is not satisfied that other member states are not willing to reduce their production in order to support crude prices, so OPEC+ may have to postpone its meeting until Sunday. OPEC is being urged to agree on deeper cuts after the American Petroleum Institute (API) released stockpile numbers overnight that confirmed a 9.047 million build in barrels. To maintain current oil prices, a cooperative strategy will be required.

This evening’s packed commodities calendar includes the release of the Energy Information Administration’s (EIA) change in the crude stockpile and the Natural Gas Storage Change for the previous week, which comes at the end of a shorter trading week in the US due to Thanksgiving. At 18:00 GMT, the Baker Hughes US Oil Rig Count figures are also due.

With a busy US calendar ahead of them and all the numbers expected on Wednesday night, oil prices are getting ready for it. Anticipate significant fluctuations, as headlines regarding a Middle East ceasefire and the recent increase in US stockpiles do not affect crude prices. There is anticipated to be a significant decline ahead of this weekend’s OPEC meeting if EIA data show a similar build.

As the last line of defence before moving into $70.00 and below, traders are observing a soft floor around $74.00 on the upside. Markets may then take into account the possibility of an unexpected OPEC+ intervention to drive up oil prices once more.