Oil prices stayed within a narrow range on Wednesday in quiet pre-U.S. Thanksgiving holiday trading, as the market awaited news on output cuts from the OPEC+ producers group and looked for confirmation of a sharp build-up in U.S. crude stocks.
Brent crude futures rose 14 cents, or 0.17%, to $82.59 a barrel by 0800 GMT. U.S. West Texas Intermediate crude futures rose 13 cents, or 0.17%, to $77.90.
Both benchmarks have fallen for four straight weeks, and prices weakened further last week on growing concerns about the demand outlook. Investors remained cautious ahead of Sunday’s scheduled OPEC+ meeting, when the producer group may discuss deepening supply cuts due to slowing global economic growth.
On Monday, both contracts climbed about 2% after three OPEC+ sources told Reuters the group, the Organization of the Petroleum Exporting Countries (OPEC) and allied producers, was set to consider additional oil supply cuts when it meets on Nov. 26.
“The upcoming meeting has been the key central focus for oil prices for now, with sentiments shrugging off the sharp build in U.S. crude inventories,” said Jun Rong Yeap, a market strategist at IG.
OPEC+ is likely to extend or even deepen oil supply cuts into next year, analysts have predicted. “While market consensus suggests Saudi Arabia and Russia will be extending voluntary cuts into 2024, any further cuts by other members will hold the key to future prices,” ANZ analysts wrote in a note.
Even if the OPEC+ nations extend their cuts into next year, the global oil market will see a slight supply surplus in 2024, the head of the International Energy Agency’s (IEA) oil markets and industry division said on Tuesday.
U.S. crude stocks rose by nearly 9.1 million barrels in the week ended Nov. 17, according to market sources citing American Petroleum Institute figures on Tuesday.
Gasoline inventories dropped by about 1.79 million barrels, while distillate inventories fell by about 3.5 million barrels.
U.S. government data on stockpiles is due on Wednesday.
Thursday is a public holiday in the United States.
(Editing by Miral Fahmy, Simon Cameron-Moore and Kim Coghill)