LONDON – Oil prices rose on Wednesday as investors turned their attention to an OPEC+ meeting to decide on output policy, while supply disruption caused by a storm in the Black Sea combined with lower U.S. inventories to drive buying.
Source: Reuters
Brent crude futures were up 61 cents, or 0.8%, to $82.29 a barrel at 1447 GMT. U.S. West Texas Intermediate (WTI) crude futures gained 75 cents, or 1%, at $77.16 a barrel.
Both benchmarks rose about 2% on Tuesday as the market anticipated that OPEC+, made up of the Organization of the Petroleum Exporting Countries and allies such as Russia, would extend or deepen supply cuts.
OPEC+ on Wednesday continued talks, which sources had described as difficult. A meeting to decide on next year’s output policy on Thursday was, however, expected to go ahead on schedule, sources said on Wednesday.
“If they (OPEC+) fail to come to a preliminary deal, we cannot rule out the risk that the meeting is further delayed, which would likely put some downward pressure on oil prices,” ING analysts Warren Patterson and Ewa Manthey said in a note to clients.
A severe storm in the Black Sea region has disrupted up to 2 million barrels per day (bpd) of oil exports from Kazakhstan and Russia, according to state officials and port agent data, raising the prospect of short-term supply tightness.
Kazakhstan’s largest oilfields are cutting combined daily oil output by 56% from Nov. 27, the Kazakh energy ministry said.
The oil market also found support from a drop in U.S. crude inventories, which fell by 817,000 barrels last week, according to market sources who cited American Petroleum Institute figures.
Eight analysts polled by Reuters estimated on average that crude inventories fell by about 900,000 barrels in the week to Nov. 24. Weekly U.S. government data on stockpiles is due on Wednesday.
Meanwhile, U.S. Commerce Department data showed the U.S. economy grew faster than initially thought in the third quarter, but momentum appears to have since waned as higher borrowing costs curb hiring and spending.
The data showed gross domestic product increased at a 5.2% annualised rate last quarter, revised up from the previously reported 4.9% pace, its fastest pace of expansion since the fourth quarter of 2021.
(Additional reporting by Yuka Obayashi in Tokyo and Muyu Xu in Singapore; Editing by Barbara Lewis and Paul Simao)
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