CRUDE futures slid in the run-up to this week’s Opec meeting yesterday as traders weighed prospects for the first cut in production quotas since 2008.
Brent for January delivery lost 1.4 percent to $78.54 a barrel (R5.42 a litre) on the London-based ICE Futures Europe exchange in the afternoon. WTI fell 1.7 percent to $74.52 at 11.24am in New York.
Prices erased earlier gains after a meeting between Venezuela, Mexico, Saudi Arabia and Russia didn’t produce an agreement on a co-ordinated oil-output reduction, according to Rafael Ramirez, Venezuela’s Foreign Minister. Igor Sechin, who runs Russian state oil producer Rosneft, said a drop in prices below $60 a barrel wouldn’t force Russia to curb output.
“Traders are split down the middle on whether Opec is going to make a meaningful cut,” Tariq Zahir at Tyche Capital Advisors in New York said. “Any kind of rally is probably going to be sold into. You have to get an above 2 million-barrel cut from Opec to stabilise the market.” – Bloomberg