Markets pending the outcome of the OPEC meeting

On Thursday, oil prices started to rise again to $48.50 per barrel. Brent is supported by the general improvement in market sentiment, which has led to an increase in all risky assets.

The statistics from EIA are also on the buyers' side. According to the US Department of Energy, the decline in crude oil reserves in the country amounted to 700 thousand barrels in the week of November 21-27. Analysts predicted a reduction of 2.3 million. At the same time, gasoline stocks rose by 3.5 million barrels, and distillate stocks – by 3.2 million barrels. Analysts had expected an increase in gasoline inventories by 2 million barrels, and distillates – by 100 thousand barrels.

Moreover, market participants continue to monitor the situation around OPEC +, hoping that the organization will extend the restrictions on oil production for next year. What will OPEC decide?

At the beginning of the week, the OPEC + group postponed the meeting for two days until Thursday. Today, the leaders of the participating countries can extend the current agreement for another 3 months. Recall that the current agreement assumes a reduction in production by 7.7 million barrels per day until the end of this year, with a subsequent increase by about 2 million barrels per day.

If the decision to extend the restrictions is not made, the oil price could drop significantly as new lockdowns and a sharp increase in the incidence of COVID-19 continue to put pressure on demand.