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Why Did Crude Oil Stabilize on November 14?

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Dec. 4 2020, Updated 10:53 a.m. ET

Crude oil was stable on November 14

After falling 1.5% in the week ending on November 11, crude oil prices were stable on November 14. On November 14, the WTI (West Texas Intermediate) crude oil futures contract for December delivery closed the day at $43.32 per barrel—a fall of ~0.21%. The Brent crude futures contract for the January 2017 contract fell ~0.32% to $44.72 per barrel.

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Crude oil regained strength as the day progressed

Crude oil started the day on a lighter note but regained strength as the day progressed. At 6:00 AM EST on November 14, the WTI crude oil futures contract for December delivery was trading at $43.19 per barrel—a fall of ~0.51%. The Brent crude futures contract for January 2017 delivery fell ~0.36% to $44.60 per barrel. The stronger dollar, the rise in the oil rig count, the rise in OPEC’s (Organization of the Petroleum Exporting Countries) supply, and speculations about the successful execution of proposed supply cuts weighed on crude oil prices of Monday morning. According to the data released by OPEC on November 11, OPEC’s crude oil output in October rose to 33.64 MMbpd (million barrels per day)—an rise of 0.24 MMbpd from the previous month.

Crude oil regained strength due to renewed hopes about OPEC’s supply cut. Saudi Arabia’s energy minister commented on November 13 that OPEC would reach an agreement to cut the production. It announced the production cut in producers’ meeting in Algeria. On November 14, major crude oil producers Carrizo Oil & Gas (CRZO) and Canadian Natural Resources (CNQ) rose 0.33% and 1%, while Total SA (TOT) and British Petroleum (BP) fell 1.2% and 0.6%, respectively. The SPDR S&P Oil & Gas Exploration and Production ETF (XOP) and the PowerShares DB Oil ETF (DBO) rose 1.3% and 0.62%.

In the next part, we’ll discuss how metals performed on November 14.

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