2024-02-13 02:54:51
The upcoming OPEC+ decision
Oil is trading in a range of $10 a barrel this year, with tensions over conflict in the Middle East and OPEC supply cuts offset by abundant production from outside the group and uncertain demand forecasts. China, the largest importer, is suffering from widespread deflationary pressures, while the Goldman Sachs Group highlighted the risks threatening consumption.
The OPEC+ alliance plans to take a decision early next month regarding extending oil production cuts in the second quarter. Earlier, Iraq said its supplies were now in line with the coalition’s previous agreement, while the United Arab Emirates said it was committed to working with the coalition to ensure market stability.
Red Sea risks push global oil buyers to move regionally
What matters to the market is “what OPEC+ decides to do with the voluntary supply cuts, which expire at the end of March,” said Warren Patterson, head of commodity strategy at ING Groep NV in Singapore. He added: “Our balance sheet indicates that the market will be in surplus in the second quarter of 2024 if the group fails to extend some of these cuts.”
Following OPEC’s forecast, the International Energy Agency will issue its corresponding view on Thursday. Trading volumes in Asia are also likely to be weak on Tuesday, with many markets closed for the Lunar New Year holiday.
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