Oil prices rebound on OPEC+ expectations
Oil prices shot higher on the anticipation that OPEC+ might extend production cuts until 2024.
Oil prices rebounded after a four-week decline driven by concerns about falling demand.
Markets are pricing in additional cuts due to an expanding crude surplus and Brent prices falling below $80.
Despite the dollar hitting a two-month low and geopolitical tensions on the table, gold prices are maintaining a relatively narrow range.
Will OPEC+ extend production cuts till 2024?
Oil prices inched higher today, extending gains from last week due to the possibility of OPEC+ intensifying efforts to reduce supply and stabilize prices. Markets are pricing in further cuts due to an expanding crude surplus and Brent prices falling below $80.
Prices rebounded from a downward trend over the past four weeks, driven by concerns about falling demand. The sell-off was prompted by a surge in crude stockpiles, reaching 3.6 million compared to the forecast of 2.5 million and 13.9 million recorded earlier in November.
Goldman Sachs analysts quoted that “deeper cuts should not be ruled out given the fall in speculative positioning and in time spreads”. Having said that, oil prices did drift higher continuing a winning streak with WTI hovering near $77 and Brent near $82.
Moreover, investors are closely monitoring the Russian crude oil trade, particularly in the aftermath of Washington imposing sanctions on three ships that have been involved in shipping Sokol crude to India.
Will gold prices go back to $2000?
Risk sentiment was buoyed earlier today by optimism regarding China’s stimulus measures, a rise in market mood and a slight recovery in US Treasury bond yields may have been added pressure on the yellow metal.
Although the dollar dropping to a two-month low and geopolitical tensions upscaling, coupled with market expectations of Fed interest rate cuts in 2024, gold prices have maintained a relatively narrow range. Following a rapid surge to $2000 earlier last month. Currently, gold prices persist in a side-way movement, hovering around $1970.