Oil price news - OPEC under pressure

03.10.2022 16:37|Conotoxia Ltd Analyst Team

We are probably approaching the moment in the oil market where OPEC countries would say "enough" to the falling prices. Oil producers, who have suffered huge losses through pandemics and lockdowns, may once again want to drive up prices so that their budgets don't suffer, from an economic slowdown or recession this time.

Oil prices’ rise at the start of the week

The price of a barrel of WTI crude oil had risen by nearly 4 percent as of 13:49 GMT +3 on Monday, with the price hovering at $82.35, while last week's low was set at $76 per barrel. Before the current rebound occurred, however, the price of oil had been falling for four months in a row. Such a series was last seen just before the outbreak. As a result, the price of WTI fell in September to its lowest level since January 2022. Since the peak of the price, which occurred when the war in Ukraine began, oil prices have fallen by more than 40 percent. It seems that OPEC countries cannot afford such a big bump. 

price of oil news

Source: Conotoxia MT5, XTIUSD, D1

What can OPEC do?

News emerged today that the Organization of the Petroleum Exporting Countries is considering cutting output by 500,000 to 1 million barrels per day, or about 1 percent of total world production. The group will meet Wednesday to decide on the move. A person familiar with the matter told the New York Times that the oil market is struggling with oversupply and demand is weakening due to the faltering global economy, BBN reported. If such a decision is made, it would be the second consecutive monthly production cut after the cartel cut output by 100,000 b/d in August due to the deteriorating global economy.

According to data published by the St. Louis branch of the Federal Reserve, the price where budget balance is achieved for the United Arab Emirates is $76 in 2022. In contrast, for Saudi Arabia it is $79. Hence, Arab countries may want to ensure that oil prices do not fall below these levels. The cartel will decide on October 5 during a meeting at its headquarters in Vienna.

Did you know that CFDs allow you to trade on both falling and rising prices?

CFDs allow you to open buy and sell positions and thus trade on rising as well as falling quotes. At Conotoxia, you can choose from more than 5,000 CFDs, including commodities and precious metals CFDs. To find an oil CFD, for example, you only need to follow 4 simple steps:

  1. To access Trading Universe - a state-of-the-art hub of financial, information, investment and social products and services with a single Smart Account, register here.
  2. Click "Platforms" in the "Invest&Forex" section.
  3. Choose one of the accounts: demo or live
  4. On the MT5 and Ctrader platforms, search for the oil CFD you are looking for and drag it into the chart window. Use one-click trading or open a new order with the right mouse button.

 

Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Conotoxia investment service)

Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.

 

 

Like the article?
Share it with friends!


See also:

Oct 3, 2022 11:04 am

Yen exchange rate - Japan forced to intervene on the yen again?

Sept 30, 2022 3:49 pm

Summary of the third quarter of 2022 in financial markets

Sept 30, 2022 11:53 am

Gold price with sixth consecutive month of decline?

Sept 29, 2022 3:00 pm

What's next for the dollar? Does the dollar exchange rate have a chance to fall?

Sept 29, 2022 10:03 am

Volatility on the pound is still high. Bank of England with temporary QE. What about the stock market?

Sept 28, 2022 3:54 pm

Biogen with a cure for Alzheimer's? Shares up significantly

76.23% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76.23% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Trading on CFDs is provided by Conotoxia Ltd. (CySEC no.336/17), which has the right to use the Conotoxia trademark.