Oil below $100 ahead of OPEC+

Oil prices were down on Wednesday ahead of a much-anticipated meeting of OPEC+ oil exporters, which must now decide on a new strategy after returning to pre-pandemic production targets.

Around 09:30 GMT, a barrel of Brent from the North Sea for delivery in October lost 1.24% to 99.29 dollars.

The barrel of American West Texas Intermediate (WTI) for delivery in September fell 1.29% to 93.20 dollars.

The OPEC+ countries (the Organization of the Petroleum Exporting Countries and its allies) are meeting in Vienna on Wednesday to discuss their oil production strategy.

“A new chapter is about to be written in the history of OPEC”says Stephen Brennock, analyst for PVM Energy.

The alliance, on paper, reversed in August the full volume of crude production cuts it made at the height of the Covid-19 pandemic as oil demand slumped pushing prices up. crude at the bottom of the abyss.

OPEC+ must now decide on a new strategy “in the post-pandemic era”in a particularly volatile and turbulent market between geopolitical tensions and fears of recession, continues the analyst.

For Brennock, the group “will be careful not to make waves”.

Analysts expect the producer alliance to agree to maintain production, or increase it slightly. A sharp increase would be greeted with skepticism by the market, given the group’s difficulties in meeting its already set quotas.

Crude oil prices also remain under pressure “as fears of a recession increase in Europe and the United States, and China’s zero-Covid policy continues to affect activity, creating a scenario that leads to lower demand for crude”recalls Ricardo Evangelista, analyst at ActivTrades.

Investors should also watch for the publication of the state of US oil inventories by the US Energy Information Agency (EIA).

Analysts expect a decline of 1.5 million barrels in commercial reserves of crude, but also gasoline, according to the median of a consensus compiled by Bloomberg.

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