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Crude Oil Prices Mixed With OPEC Meeting in Focus

Published 11/27/2017, 09:50 AM
© Reuters.  Crude prices mixed, WTI just off 2-year peak ahead of OPEC meeting
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Investing.com - Crude oil prices were mixed on Monday, as markets were jittery ahead of a highly-anticipated meeting of global oil producers scheduled on Thursday.

The U.S. West Texas Intermediate crude January contract was down 76 cents or about 1.29% at $58.19 a barrel by 09:50 a.m. ET (13:50 GMT), off Friday's two-year highs of $59.05.

Elsewhere, Brent oil for February delivery on the ICE Futures Exchange in London was up 18 cents or about 0.28% at $63.65 a barrel.

Investors remained cautious as oil ministers from the Organization of Petroleum Exporting Countries and other major producing countries were set to meet in Vienna on Thursday to decide whether to extend their current production agreement beyond a March 2018 deadline.

Russia said on Friday that it is ready to support extending the deal, but made no mention of how long it should last beyond its March expiry.

Under the original terms of the deal, OPEC and 11 other non-OPEC producers, led by Russia, agreed to cut output by about 1.8 million barrels per day for the first six months of 2017. The agreement was extended in May of this year for a period of nine months until March 2018 in a bid to reduce global oil inventories and support oil prices.

The OPEC-led production cuts have been one of the key catalyst supporting the recent rally in oil prices amid expectations that rebalancing in crude markets are well underway.

However, fears that rising U.S. output would dampen OPEC’s efforts to rid the market of excess supplies are prevented prices from rising much further, according to market participants.

Domestic U.S. output has rebounded by almost 15% since the most recent low in mid-2016, and increasing drilling activity for new production means output is expected to grow further, as producers are attracted by climbing prices.

Elsewhere, gasoline futures were up 0.45% at $1.791 a gallon, while natural gas futures gained 2.78% to $2.997 per million British thermal units.

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