Disagreements between members of the Organization of the Petroleum Exporting Countries (OPEC+) have sent oil prices down. At the time of writing, global benchmark Brent crude oil is currently hovering above $81 per barrel after a marginal drop in Thursday’s trading session.
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Indeed, the 23+ member organization postponed its meeting to November 30 following disagreements over oil production quotas. Reports noted that African members are the aggrieved parties here, with the more powerful nations looking to cut their quotas.
According to Citigroup analysts, including Eric Lee, the meeting delays are heightening speculation about the quota distribution. They noted that Saudi Arabia is expected to roll its 1 million barrel-a-day voluntary cut into 2024. Additionally, the analyst said that other OPEC+ members broadly committed to existing quotas through next year.
At the same time, OPEC+ member nations dispelled rumors that Angola may exit the group. “There’s no thinking in that direction,” Angola’s OPEC governor Estevao Pedro is quoted to have said.
The recent troubles within OPEC+ follow speculations that oil production output outside the group is expanding. As a result, investors are weighing whether the group will extend production cuts or possibly deepen them.
It bears mentioning that a failed OPEC+ agreement on oil production quotas for next year would leave global oil markets in a precarious position. As demand growth has slowed, crude oil prices have dropped by around 16% from their peak in September.
What is the Best Oil Stock to Buy Today?
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