OIL: Crude Holds Onto Losses Ahead Of OPEC Announcement

Oil prices are little changed ahead of the OPEC announcement later today. They fell sharply on Wednesday given uncertainty around the decision, but the group is widely expected to delay the reduction in output cuts again. WTI is up 0.1% to $68.60 /bbl during today’s APAC trading, close to the intraday low, and Brent is steady at $72.27/bbl. The USD index is unchanged.

• Originally OPEC+ planned to reduce its previous output cuts by 180kbd from October but given lower prices and concerns over excess supply in 2025 it delayed them twice. The increase in supply is currently scheduled for the start of January but could be pushed back to the end of March now. There has been some disagreement within OPEC as a number of countries have excess capacity they want to use and others are concerned the group will lose market share.
• Rising non-OPEC output is a significant reason for the delay to OPEC’s output normalisation. Bloomberg is reporting that currently the US produces over 13.5mbd compared with Saudi’s 9mbd, and this could rise under the Trump administration. Also, the strength of China’s demand is an ongoing concern.
• Following OPEC’s decision, market attention will turn to US November payrolls, which are forecast to rise 215k with the unemployment rate steady at 4.1%.
• Later the Fed’s Barkin speaks and US November Challenger job cuts, October trade and jobless claims print. Canadian November PMI, German October factory orders and euro area retail sales are also released. BoE’s Greene speaks.