Update: WTI Crude Oil Rises as OPEC+ Expected to Take Steps to Shore Up Prices
02:35 PM EST, 11/20/2023 (MT Newswires) -- West Texas Intemediate (WTI) crude oil closed higher on Monday on expectations OPEC+ will take steps to further restrict supply after prices fell to a four-month low last week on slowing demand and rising inventories.
WTI crude for December delivery closed up US$1.77 to settle at US$77.60 per barrel, while January Brent crude, the global benchmark, was last seen up US$1.61 to US$82.22.
OPEC+ will meet on Nov.26 amid reports the cartel will take additional steps to boost prices amid rising non-OPEC supply and a slowing US economy that is hampering demand and swelling inventories. Saudi Arabia is expected to continue its one-million barrel per day supply cut, scheduled to end on Dec.31, into the new year, while other measures, including addition quota cuts, may be on the table.
"Regardless of the path they take, Saudi Arabia's decision on the production cuts will ultimately shape the short-term future of global oil prices. The kingdom is balancing the desire to keep prices high by limiting supply with the knowledge that doing so will lead to a further drop in overall market share ... This recent nosedive could be an indicator of what's to come at the OPEC meeting, as the Saudis have repeatedly demonstrated that their price floor is above $80 per barrel," Jorge Leon, a senior vice president at Rystad Energy, noted.
Prices last week fell to the lowest since early July after the Energy Information Administration, reported a 3.6-million barrel rise in inventories a week earlier, bringing the two-week rise to 17.5-million barrels, while US production stayed at a record 13.2-million barrels per day, 1.1-million bpd above the year-prior level.