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WTI Crude Remains Pressured Below $68.50 as Markets Await OPEC+ Meeting

WTI Crude Stays Below $68.50 Ahead of OPEC+ Meeting

WTI Crude Remains Pressured Below $68.50 as Markets Await OPEC+ Meeting

West Texas Intermediate (WTI) crude oil prices remain under modest selling pressure for the second consecutive day on Thursday, erasing a significant portion of weekly gains. During the Asian session, WTI trades below $68.50, down 0.30% for the day, with downside risks cushioned ahead of the anticipated OPEC+ meeting later today.

Key Drivers:

  1. OPEC+ Production Plans:
    Reports indicate that OPEC+ is likely to delay any production increases until at least Q2 2025 due to concerns over weakening global oil demand, particularly from China, the world’s largest importer.
  2. Geopolitical Risks:
    The ongoing Russia-Ukraine conflict and heightened tensions in the Middle East sustain a geopolitical risk premium, offering some support to crude oil prices despite recent declines.
  3. US Oil Inventory Data:
    The Energy Information Administration (EIA) reported a sharper-than-expected drop in US crude inventories, with stockpiles decreasing by 5.07 million barrels in the final week of November. This unexpectedly strong drawdown signals robust demand and provides a partial cushion to oil price declines.
  4. US Economic Outlook:
    Signs of resilience in the US economy and optimism around President-elect Donald Trump’s expansionary policies boosting fuel demand add to the market’s mixed sentiment.

Looking Ahead:
Market participants are cautious as they await the outcome of the OPEC+ meeting, which could offer clarity on production strategies and demand forecasts. Additionally, focus shifts to Friday’s US Nonfarm Payrolls (NFP) report, a key indicator for Federal Reserve policy expectations. The employment data will likely influence the US Dollar’s movement, indirectly impacting crude oil prices.

In the short term, WTI’s price action is expected to remain subdued, with geopolitical and supply-side factors providing a floor, while concerns over demand and broader market sentiment limit the upside.