Brent Crude Oil Prices plummeted to $ 79.94 post the OPEC+ meeting after reaching as high as $84.51 in the session earlier and are trading lower in the Asian Session today.
Meeting Highlights
OPEC+ reached an agreement to deepen Oil production cuts. The total voluntary cuts for the Q1 total 2.184 mn bpd. Since the nature of cuts was voluntary, it was announced by each member state and not by the group as a whole.
Algeria 51
Kazakhstan 82
Saudi Arabia 1,000
Russia 500
Oman 42
Iraq 211
Kuwait 135
UAE 163
Total 2,184
Brazil (the largest oil producer in Latin America since 2016) would join the OPEC+ group effective in January.
Angola has rejected its quota.
What the market thought about announcement???
"this is a repackaging of previously agreed measures, with some uncertain extras".
"the concern is that a large fraction of it could be a pledge on paper and effectively less barrels being removed from the market"
"it isn’t clear how much of this will actually result in barrels coming out of the market, rather than "paper" cuts against higher quotas, or cuts versus quotas that are already not being hit."
Technically, after the Head & Shoulder breakdown on Nov 7, 2023, prices have largely consolidated between $79 - $84. The technical picture looks weak . The target for the H&S is $72 which coincides with the cluster of supports.
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