March 16, 2023 09:52 GMT
OPEC+ To Wait For Financial Markets To Calm Before Deciding Action
OPEC+ will probably wait for financial markets to calm before deciding whether it needs to react to oil’s rout by cutting production, according to Energy Aspects analyst Amrita Sen.
- “It would be premature for OPEC+ to take action without first understanding what the risks are,” Sen said. The US Federal Reserve and European Central Bank “need to address market conditions before OPEC+ makes any moves,” she added.
- “OPEC sources note crude demand remains extremely robust and is at odds with the commodity’s selloff. The last thing OPEC+ wants is to even mention a possibility of production cuts out of concerns that the market will misconstrue these comments as fear of demand weakness,” she added.
- The group’s monitoring committee is scheduled to meet next on 3 April.
- Global markets were roiled on Wednesday as turmoil at Credit Suisse Group triggered panic among banking investors. The crisis spread to commodities, with oil falling to a 15-month low. Brent crude is down 10% this week, trading as low as $71.83/bbl, though it pared losses early on Thursday after Swiss monetary authorities offered support to Credit Suisse.
- Brent MAY 23 up 1.1% at 74.5$/bbl
- WTI APR 23 up 1% at 68.27$/bbl