Brent sell

Brent oil price declines despite OPEC+ efforts

01 December 2023 205
Brent oil price declines despite OPEC+ efforts

There was a decline in prices in the oil market on Friday during early Asian trading, despite the decision made by the Organization of the Petroleum Exporting Countries and their allies (OPEC+). Brent prices fell by 2.4% over the day.

At yesterday's OPEC+ meeting, the official quotas were not changed. However, some countries decided to voluntarily cut oil production by 2.2 million barrels per day (bpd) in the first quarter of 2024. Saudi Arabia will reduce production by 1 million bpd, Iraq — by 223,000 bpd, UAE — by 163,000 bpd, Kuwait — by 135,000 bpd, Kazakhstan — by 82,000 bpd, Algeria — by 51,000 bpd, and Oman — by 42,000 bpd.

Russia extends and tightens current export restrictions. Until the end of 2023, the country’s exports of crude oil and petroleum products have been reduced by 300,000 bpd compared to May-June 2023. The Russian government announced that the country will increase these cuts by another 200,000 bpd to 500,000 bpd and extend them to the first quarter of 2024. At the same time, the 300,000 bpd reduction will apply to crude oil supplies, while the 200,000 bpd reduction will apply to petroleum product supplies.

OPEC+ oil production has so far decreased by 5 million bpd due to the alliance's actions aimed at stabilizing the oil market. The total volume is now around 43 million bpd.

The cuts will be phased out as market conditions allow. This strategy is shared by many countries, according to Reuters.

Investors continue to analyze the results of the OPEC+ ministerial meeting.

Brent oil started to form an upward correction after the price went beyond the descending H4 timeframe. Divergence of the Relative Strength Index (RSI) (standard values) predicts a downward movement of oil prices. If the price goes beyond the support of the correction channel, the movement of bearish positions will intensify.


The short-term outlook for Brent suggests selling

The target is at the level of 73.10.

Part of the profit should be taken near the level of 76.70.

A stop-loss could be placed at the level of 85.45.

 The bearish trend is short-term, so trade volume should not exceed 2% of your balance.

This content is for informational purposes only and is not intended to be investing advice.

New Popular
Commenting rules