Oil Rises a Third Day on OPEC+ Cut Chatter, Falling Stockpiles




  • In Business
  • 2022-11-30 00:44:51Z
  • By Bloomberg

(Bloomberg) -- Oil rose for a third day after industry data pointed to a substantial draw in US crude stockpiles and investors counted down to an OPEC+ meeting that may see the group agree to cut production.

Most Read from Bloomberg

  • Scientists Revive 48,500-Year-Old 'Zombie Virus' Buried in Ice

  • Banks Stuck With $42 Billion Debt Seize Chance to Offload It

  • These Are the Best and Worst Cities for Expats to Live and Work In

  • This Is Where Luxury Property Prices May Rise and Fall the Most in 2023

  • Apple to Lose 6 Million iPhone Pros From Tumult at China Plant

West Texas Intermediate climbed toward $79 a barrel after adding 2.5% over the previous two sessions. The industry-funded American Petroleum Institute reported inventories fell by almost 8 million barrels last week, according to people familiar with the figures. Official data follow later on Wednesday.

The Organization of Petroleum Exporting Countries and allies including Russia will meet virtually on Dec. 4, and there's speculation the alliance will agree again to reduce supply to counter market weakness. The gathering comes the day before a deadline for European Union sanctions on Russian crude flows, although a related price cap has yet to be finalized.

Crude has retreated about 9% this month on concern that a global economic slowdown will sap energy demand, with widely watched market metrics signaling ample near-term supply. Traders are also tracking events in virus-hit China as Beijing pushes for more vaccinations among seniors, a move seen as crucial for an eventual reopening and one that follows a wave of protests.

Brent will average $95 a barrel this quarter, though "demand concerns in China and the high price cap that's likely to be applied" could weigh on prices, said Vivek Dhar, mining and energy commodities analyst at Commonwealth Bank of Australia. OPEC+ will likely agree to "keep output levels unchanged, particularly given the group is set to meet virtually," he said.

EU diplomats have been seeking a compromise on the level of the US-led cap, which is among moves to punish Moscow for the war of Ukraine by curbing revenue while keeping the nation's crude flows going. US energy security adviser Amos Hochstein said the plan needs to strike a "delicate balance."

Key time spreads are signaling abundant near-term supply, with Brent and WTI's prompt spreads -- the gap between the nearest two contracts -- in a bearish contango pattern. The figure for Brent was $1.22 a barrel in contango, compared with 66 cents in the opposite backwardated structure last week.

Elements, Bloomberg's daily energy and commodities newsletter, is now available. Sign up here.

Most Read from Bloomberg Businessweek

  • Car Price Divergence Hints at More Painful Inflation Ahead

  • Tesla's Lithium Lead at Risk as Rivals Make Supply Deals

  • How to Keep Your Investments Halal

  • More Men Are Staying Out of the Workforce to Care for Kids

  • Apple's Reliance on China Grows Perilous With Chaos in iPhone City

©2022 Bloomberg L.P.

COMMENTS

More Related News

Meta to Ask Many Managers to Become Individual Contributors or Leave
Meta to Ask Many Managers to Become Individual Contributors or Leave

(Bloomberg) -- Meta Platforms Inc. is asking many of its managers and directors to transition to individual contributor jobs or leave the company as it tries...

What to Look Out for in Biden
What to Look Out for in Biden's Second State of the Union Speech

(Bloomberg) -- President Joe Biden will speak to a joint session of Congress on Tuesday evening against the backdrop of renewed tensions with China and a...

Nomura
Nomura's Japan Staff to Get Bigger Raises as Inflation Quickens

(Bloomberg) -- Nomura Holdings Inc. will give its employees in Japan bigger pay raises starting in April, citing intensifying competition for talent and...

Quake Latest: Turkish Rescuers Race Against Time in Cold Weather
Quake Latest: Turkish Rescuers Race Against Time in Cold Weather

(Bloomberg) -- Most Read from BloombergQuake Toll Hits 4,000 in Turkey, Syria as Overseas Aid FlowsTurkey's South Hit by a Second High-Magnitude...

Biggest South Africa Cement Firm Mulls Sale of Zimbabwe Unit
Biggest South Africa Cement Firm Mulls Sale of Zimbabwe Unit

(Bloomberg) -- PPC Ltd., South Africa's largest cement maker, is considering selling its Zimbabwe business for about $200 million, according to people with...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply

Comments

Top News: Business