The black gold opens the week in the red after softening in early morning trading, along with the scheduled meeting of the OPEC monitoring committee.
Several happenings in the world’s largest oil have driven oil price off-course, particularly the lower-than-expected but still robust GDP growth by China.
The country recorded a 4.9% hike for the quarter, modestly short of analysts’ projected 5.2%.
But the country is still considered the first major economy to experience a rebound as the on-going rise in Covid-19 cases incapacitates all other developed nations’ economies.
Due to the shift, industry experts note that the crude importer may lower demand for the next quarter along with the stabilizing economic growth.
According to economists, China’s buying purge started in the early onset of the pandemic will soften in the next quarter and weighed down by limited import quotas imposed on small refiners.
With this, market spectators eye another round of sluggish demand due to the projected easing of Chinese imports.
December Brent futures shed off 20 cents or 0.5%, currently trading at $42.73 per barrel.
Meanwhile, in the New York Mercantile Exchange, the West Texas Intermediate followed its counterpart’s downward trend.
WTI futures for November delivery eased 19 cents in the latest session. Nevertheless, the commodity still trades slightly above the critical threshold of $40, settling at $40.69.
Will Oil Price Stabilize after the OPEC JMMC Meeting?
After last week’s rounds of discussions among OPEC+ Joint Technical Committee, the organization’s Joint Ministerial Monitoring Committee will meet today to discuss the market’s on-going developments.
The entity is reported to discuss whether to reduce the current production curbs to 2 million or stick to the status quo.
For the record, the oil association and ally Russia have decided to impose a supply cut of 7.7 million barrels per day in April as the demand failed to keep up with oversupply, driving oil price to volatility.
Due to this, the bloc members agreed to cut supply to stabilize prices in the market.
So far, in the latest report, members are compliant with the agreement after the de facto leader issued a warning for the violators.
According to analysts, there is a growing call in the market, appealing to OPEC put a current plan of easing cuts to later due to still gloomy demand.
Last week, the Joint Technical Committee reported a sluggish fuel outlook due to the rising fears from the second wave of infections.
