Ahead of OPEC Meeting, Crude Oil Price Down in Global Market
By : Abraham Sihombing And Aldo Bella Putra | Tuesday, November 21 2017 - 17:00 IWST
OPEC (Foto Ist)
INDUSTRY.co.id - NEW YORK - The price of West Texas Intermediate (WTI) crude for December 2017 shipments in the global market fell 70 cents, or about 1.2%, to $ 55.85 a barrel. Brent crude for January delivery was down 50 cents to $ 62.22 a barrel on the London ICE Futures Exchange.
Similarly reported Reuters and Xinhua in New York, Monday (20/11/2017) or Tuesday (21/11/17) early morning hrs.
The decline in crude oil prices in the global market comes ahead of a meeting of oil exporters (OPEC) next week. Meanwhile, the strengthening of the US dollar against the world's leading currencies has also affected commodity trading throughout the world's stock market futures trading.
OPEC and a group of non-OPEC crude producers led by Russia agreed to hold crude supplies from early 2017 to tighten crude inventories in global markets to boost prices.
The deal will end in March 2018, and OPEC will hold a meeting in Vienna, Austria, on November 30, 2017 to discuss the policy. The market expects the deal to extend through 2018.
"OPEC and the 10 non-OPEC countries are expected to halt oil supplies to global markets throughout 2018, although Russia has yet to show a clear position," said Tamas Varga, PVM Oil Associates analyst.
Last week, OPEC predicted crude oil demand to rise 460,000 barrels per day (bpd) to 33.42 million bpd by 2018. Meanwhile, the International Energy Agency (IEA) estimates a decline in demand for 320,000 bpd to 32.38 million bph next year.
The appreciation of the US dollar exchange rate also weighed on commodity prices, including oil. The US dollar strengthened against the euro after Germany was reported unable to form a coalition government continues to add to the political uncertainty of the European Union. The dollar strengthened 0.4 percent against the euro.
Oil prices are inversely related to the US dollar exchange rate. The reason, the appreciation of the US dollar will make crude oil prices become more expensive in global markets so as to suppress market demand. (Abraham Sihombing)