Xinhua News Agency, New York, November 4th
Xinhua News Agency reporter Liu Yanan
The 22nd ministerial meeting of the Organization of Petroleum Exporting Countries (OPEC) and non-OPEC oil-producing countries was held in video on the 4th. The participating countries decided to continue the original plan for gradual increase in production. As many investors took profit-taking operations after the announcement of the news, the international crude oil futures prices fluctuated lower that day, and dropped significantly at the close.
As of the close of the day, the price of New York Mercantile Exchange light crude oil futures for delivery in December 2021 fell by US$2.05 to close at US$78.81 per barrel, a decrease of 2.54%; the price of London Brent crude oil futures for delivery in January 2022 Fell 1.45 US dollars to close at 80.54 US dollars per barrel, a decrease of 1.77%.
Data show that the price of New York crude oil futures for delivery in December has fallen by 6.08% in the past two trading days, and the price of Brent crude oil for delivery in January 2022 has fallen by 4.93% over the same period.
OPEC issued an announcement on the 4th that the participating OPEC and non-OPEC oil-producing countries reconfirmed the production adjustment plan and monthly production adjustment mechanism approved by the 19th ministerial meeting, and decided to increase the average daily production in December according to the original schedule. 400,000 barrels.
Andy Brogan, head of Ernst & Young’s global oil and gas trading services, said that the decision by OPEC and partner countries to maintain the current production increase is not surprising to the market. With the rebound in demand, the strategy of cautiously increasing supply by reducing countries has been quite successful in controlling oil prices.
Caroline Bain, chief commodity economist at Capital Investment Macroeconomics, a market research firm, pointed out that the oil price of more than $80 per barrel makes OPEC and partner countries not eager to increase market supply, especially in the United States where oil producers are not willing to increase production. Case.
Affected by seasonal factors, the uncertainty of the epidemic, the policies of oil-producing countries, and the game between market players, the current oil price is facing greater uncertainty, and the market is still divergent on the trend of oil prices in the future.
Russian Energy Minister Novak said that since August, OPEC and partner countries are increasing the supply of crude oil as planned with the recovery of the global economy. On the other hand, European oil demand showed signs of declining in October, and global crude oil demand may experience a seasonal decline in the fourth quarter of this year and the first quarter of next year. Due to the rebound of the new crown epidemic and the impact of epidemic prevention and control measures in some countries, global oil demand is still under pressure.
Bain believes that as OPEC and partner countries gradually increase production and other oil-producing countries increase production, there will be oversupply in the oil market. It is estimated that by the end of 2022, the price of Brent crude oil futures will drop to around US$60 per barrel.
Ann-Louis Hitler, vice president of macro oil market research at Wood Mackenzie Consulting, believes that Brent crude oil futures prices may have begun to decline from a high level.
Rob Haworth, a wealth management investment strategist at United Bank of America, believes that the current oil supply may be at the lower end of the average level and will continue to support oil prices. In addition, the oil demand of US companies will gradually rise, which is expected to further support higher oil prices.