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Crude Oil Prices Fell on November 29 before OPEC’s Meeting

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Crude oil prices fell on November 29

After moving higher on November 28 amid volatile trade, crude oil prices fell on November 29. On November 29, the West Texas Intermediate crude oil futures contract for January 2017 delivery fell 3.9% and closed the day at $45.23 per barrel. The Brent crude futures contract for January 2017 delivery closed at $46.38 per barrel—a fall of 3.9%.

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Doubts about supply cuts dragged prices down

Doubts about the successful execution of OPEC’s supply cuts weighed on the crude oil market. The prices fell as much as 4% on November 29 as oil producers struggle to come to an agreement. Iran and Iraq aren’t supporting the oil cut, which made the sentiment weaker. In its previous meeting in Algeria, OPEC announced a supply cut for its members to 32.5 MMbpd to 33 MMbpd (million barrels per day). The market is looking forward to producers’ meeting on November 30 in Vienna. Individual supply quotas will be declared. In October, OPEC’s production was 33.64 MMbpd.

Russia, which is a non-OPEC producer, confirmed on November 29 that it won’t attend OPEC’s meeting. It also added that a meeting with OPEC and non-OPEC producers is possible at a later stage. On the other hand, the American Petroleum Institute reported that the crude oil inventory levels fell by 0.72 MMbbls (million barrels) in the week ending on November 25. The market was expecting a drop in inventories by 0.6 MMbbls.

On November 29, major crude oil producers Carrizo Oil & Gas (CRZO), Canadian Natural Resources (CNQ), and British Petroleum (BP) fell 2.9%, 2.4%, and 0.56%, respectively, while Total SA (TOT) rose 1.1%. The SPDR S&P Oil & Gas Exploration and Production ETF (XOP) and the PowerShares DB Oil ETF (DBO) fell 1.9% and 3.4%.

In the next part, we’ll discuss how copper performed on November 29.

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