OPEC + begins two-day negotiations in oil rout


London — OPEC and its allies will launch a two-day meeting on Wednesday to decide whether to release more oil to the market or limit supply in the midst of a plunge in oil prices, with variants of the Omicron coronavirus. We are afraid that it may weaken the world’s energy demand.

Oil prices on Tuesday fell from $ 86 in October to nearly $ 70 a barrel, the largest monthly decline since the pandemic began. This is because the new variant has created a fear of oversupply.

Brent in November was down 16.4% and WTI was down 20.8%. This is the largest monthly decline since March 2020.

“The threat to oil demand is real,” said Louise Dixon, senior oil market analyst at Listad Energy. “Another wave of blockade could result in the loss of up to 3 million barrels / day (barrels / day) of oil demand in the first quarter of 2022.”

Federal Reserve Chair Jerome Powell said it is likely to discuss accelerating bond purchase cuts as the economy is booming and inflation is expected to continue to surge.

The Organization of Petroleum Exporting Countries (OPEC) will meet on Wednesday after 1300 GMT, followed by an OPEC + meeting on Thursday to group OPEC with its allies, including Russia.

Several OPEC + ministers, including Russia and Saudi Arabia, said there was no need for a kneeling reaction from the group.

However, some analysts have suggested that OPEC + may withhold plans to add 400,000 barrels (bpd) per day to supply in January.

The group had already considered the impact of last week’s announcement by the United States and other countries to release emergency oil reserves to curb energy prices.

OPEC + has gradually reduced the record supply cut of 10 million barrels / day last year and is still reducing about 3.8 million barrels / day.

According to a Reuters study, OPEC’s increase in oil production in November was once again below the planned increase under an agreement with its allies.