Russia, Saudi to extend OPEC+ pact to arrest sliding oil prices

Gulf OPEC members covered output gap left by Iran on Trump’s call

The price of West Texas Intermediate (WTI) for January delivery increased 1.01 percent, while Brent crude for January delivery lost 0.15 percent, during the week ending November 30. At the opening of Brent was trading at 59,73 per barrel, up 18 cents below the closing level ($59,91). Last Wednesday, the market took a further hit when Khalid al-Falih, the Energy Minister of the Kingdom of Saudi Arabia, said that his country would not reduce its output alone in order to stabilise the market.

On Tuesday, oil prices dropped slightly ahead of the scheduled OPEC meeting.

Oil also received support from an announcement by the Canadian province of Alberta that it would force producers to cut output by 8.7 percent, or 325,000 barrels per day (bpd), to deal with a pipeline bottleneck that has led to crude building up in storage. Repeated fall in oil prices from past seven weeks has pushed the crude futures downward in a bear market.

To the adoption of this decision calls on Saudi Arabia amid a 30 percent collapse in oil prices towards the beginning of October.

While crude oil has not been included in the USA import tariffs, traders are taking advantage of the positive sentiment and driving crude markets.

The most recent stream of fuel market selling came along with the increasing concern about acceleration in global supply and deceleration in the market financial growth.

U.S. oil producers continue to produce record amounts of oil, with crude output at a record level of more than 11.5 million bpd. The volume reduction can range from 1.0 to 1.4 million barrels./day. That exceeded weekly estimates by 428,000 barrels a day, the second time in as many months that the agency revised its preliminary data sharply higher. WTI rose 1.16 USA dollars to settle at 51.45 dollars a barrel, while Brent rose 0.81 dollar to close at 59.57 dollars a barrel.

Last month, an advisory group to OPEC told the ministers that the market is witnessing an oversupply which is driving the oil prices down. WTI decreased 0.52 USA dollar to settle at 50.93 dollars a barrel, while Brent decreased 0.8 dollar to close at 58.71 dollars a barrel. Russian Federation also cut production in November but has not yet announced its readiness to continue reduction.

As if to validate Brennock's outlook, Alexander Novak, energy minister for Russian Federation, stated in an interview with TASS published Friday that producers and consumers were comfortable with current oil prices.

For now, the oil market remains divided on the outcome of the OPEC meeting.

Meanwhile, the number of active drilling rigs in the United States decreased by three to 1,076 in the week ending November 30. Attending countries would agree some form of production cut in the meeting.

China and the United States agreed during a weekend meeting in Argentina of the Group of 20 leading economies not to impose additional trade tariffs for at least 90 days while they hold talks to resolve existing disputes.

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