- WTI price experiences upward support on the subdued Greenback.
- Crude oil prices faced pressure on softer output cuts.
- OPEC+ decided to reduce a total of 2.2 million bpd for the first quarter of 2024.
- Downbeat US bond yields contribute to pressure on the US Dollar.
West Texas Intermediate (WTI) recovers the recent losses, trading higher around $75.90 per barrel. Crude oil prices see an improvement, propelled by a weaker US Dollar (USD). However, the WTI price faced losses following the decision of the Organization of the Petroleum Exporting Countries and its allies (OPEC+) to implement voluntary output cuts, smaller than expected, for the first quarter of 2024.
OPEC+ announced a total reduction of 2.2 million barrels per day (bpd) from eight producers in a statement following the meeting. This includes the extension of voluntary cuts by Saudi Arabia and Russia, amounting to 1.3 million bpd. The additional 900,000 bpd of cuts pledged on Thursday comprises 200,000 bpd in fuel export reductions from Russia, with the remaining cuts distributed among six other member countries.
The pressure on oil markets intensified with the release of weak Purchasing Managers Index (PMI) data from China. Business activity in the world’s largest oil importer displayed minimal signs of improvement in November. Although, on Friday, Manufacturing PMI in November showed improvement.
China’s Caixin Manufacturing PMI surpassed expectations, recording an improvement to 50.7 in November, contrary to the expected decline to 49.8 from the previous reading of 49.5. This unexpected positive turn in the data could potentially offer support and strengthen the Crude oil prices.
On Wednesday, the US EIA Crude Oil Stocks Change for the week ending on November 24 reported the barrels of stock at 1.609M against the deficit of 0.933M. On Friday, Baker Hughes US Oil Rig Count will report the number of active rigs.
Read the full article here