Brent crude is up around half a dollar to $78.7 a barrel with the markets trying to figure out what will happen at tomorrow’s OPEC meeting in Vienna.
OPEC represents around 40% of total global oil production and includes the following members:
| Algeria |
Iran |
Libya |
Saudi Arabia |
| Angola |
Iraq |
Nigeria |
United Arab Emirates |
| Ecuador |
Kuwait |
Qatar |
Venezuela |
Weak global demand for oil as well as booming shale production in the United States have made life difficult lately for the oil cartel and it is clear there are significant differences of opinion between its representatives. Talks yesterday between the oil ministers of Saudi Arabia and Venezuela, and non-Opec producers Russia and Mexico ended in no agreement with comments from Saudi oil minister Ali Al-Naimi that “The market will stabilise itself eventually” particularly worrying traders.
Rafael Ramírez, Venezuela’s foreign minister said participants in Tuesday’s meeting had agreed only that prices below $80 were “not good” and they would meet again in three months’ time. “If we have an agreement, that will be inside Opec,” he added. In a statement released after the meeting, Mexico’s energy and foreign ministries said: “The ministers agreed that it would be useful to maintain a frank and open dialogue that would allow greater information about market fundamentals and outlook, with the aim of achieving greater stability.”
So with OPEC seemingly happy for the price of oil in the short term to be dictated by market forces and with the US supply glut in full swing there doesn’t seem to be any cause for optimism of a rapid bounce in the price of oil. Bad news for smaller producers and those in the investment phase. Further news from Vienna will be interesting reading.
Contrarian Investor UK
IMPORTANT: The posts I make are in no way meant as investment suggestions or recommendations to any visitors to the site. They are simply my views, personal reflections and analysis on the markets. Anyone who wishes to spread bet or buy stocks should rely on their own due diligence and common sense before placing any spread trade.
by contrarianuk
Crude oil rallies slightly after yesterday’s falls
Nov 26, 2014 at 10:50 am in Market Commentary by contrarianuk
Brent crude is up around half a dollar to $78.7 a barrel with the markets trying to figure out what will happen at tomorrow’s OPEC meeting in Vienna.
OPEC represents around 40% of total global oil production and includes the following members:
Weak global demand for oil as well as booming shale production in the United States have made life difficult lately for the oil cartel and it is clear there are significant differences of opinion between its representatives. Talks yesterday between the oil ministers of Saudi Arabia and Venezuela, and non-Opec producers Russia and Mexico ended in no agreement with comments from Saudi oil minister Ali Al-Naimi that “The market will stabilise itself eventually” particularly worrying traders.
Rafael Ramírez, Venezuela’s foreign minister said participants in Tuesday’s meeting had agreed only that prices below $80 were “not good” and they would meet again in three months’ time. “If we have an agreement, that will be inside Opec,” he added. In a statement released after the meeting, Mexico’s energy and foreign ministries said: “The ministers agreed that it would be useful to maintain a frank and open dialogue that would allow greater information about market fundamentals and outlook, with the aim of achieving greater stability.”
So with OPEC seemingly happy for the price of oil in the short term to be dictated by market forces and with the US supply glut in full swing there doesn’t seem to be any cause for optimism of a rapid bounce in the price of oil. Bad news for smaller producers and those in the investment phase. Further news from Vienna will be interesting reading.
Contrarian Investor UK
IMPORTANT: The posts I make are in no way meant as investment suggestions or recommendations to any visitors to the site. They are simply my views, personal reflections and analysis on the markets. Anyone who wishes to spread bet or buy stocks should rely on their own due diligence and common sense before placing any spread trade.