OPEC+ Meeting Was Unable To Support Crude Oil Futures Closed Slightly Lower
Oct.20 (Beijing time) - Crude oil futures ended slightly lower after a committee meeting of THE Organization of petroleum Exporting Countries (Opec) and its Allies failed to boost oil prices, while expectations of a U.S. fiscal stimulus package eased demand concerns over a surge in coronavirus cases and pressure on Libya to boost production.
November WTI futures fell 5 cents, or 0.1%, to settle at $40.83 a barrel on the New York Mercantile Exchange. Brent Crude, the global benchmark, fell 22 cents to settle at $42.71 a barrel.
Analysts focused on Monday's meeting of the Opec + ministerial oversight committee. Russia's energy minister AlexanderNovak said the committee recommended full compliance with the group's global agreement to reduce oil production.
In a statement, OPEC+ reiterated its commitment to the deal and said it "encourages" signatories to increase their efforts to reverse "overproduction" and rebalance the market.
Saudi Arabia, Opec's largest member, said no one should doubt the group's commitment to support, while three sources in the producing countries said the planned increase in production, which began in January, could be reversed.
Opec and a group of Allies, including Russia, are cutting output to 7.7 million barrels a day from 9.7 million barrels a day previously. Saudi Energy Minister Prince Abdulaziz bin Salman said OPEC+ had shown it could adapt flexibly to changing circumstances as needed.
StephenBrennock, at oil broker PVM, said: "the latest round of stringent restrictions will inevitably hamper economic growth and undermine the recovery in fuel demand."
House speaker NancyPelosi said Sunday that she is optimistic about the possibility of passing legislation on a broad rescue package before the election.
Bank of America expects brent and WTI to average $44 and $40 a barrel respectively in 2020, and $50 and $47 in 2021. Meanwhile, Bank of America expects China's oil buying spree at the start of the year to slow in the fourth quarter as Chinese refineries slowed processing in September.
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