Oil Weakens, Markets Fear Ukraine Deal & OPEC+
Oil prices moved slightly lower on Thursday, after rising more than 1% in the previous session. WTI January contracts traded around US$58, while Brent January contracts held just above US$63 per barrel. This movement reflects a market that is becoming cautious after a brief rally, with limited buying interest ahead of the US Thanksgiving holiday.
Market participants' primary focus is now on diplomatic efforts to resolve the Russia-Ukraine war. US Presidential Special Envoy Steve Witkoff is scheduled to lead a delegation to Russia next week to continue talks. Investors are trying to gauge, if any, the extent and speed of the impact on Russian oil flows to the global market.
At the same time, market participants are also awaiting the OPEC+ meeting on November 30. The eight members of the alliance had previously agreed to halt planned production increases in the first quarter of next year, after aggressively increasing supply throughout 2025. This decision will be key to whether the supply surplus can be controlled or widens further.
On a monthly basis, oil prices are still trending toward a fourth consecutive month of decline, potentially the longest losing streak since 2023. Concerns about a growing supply surplus, coupled with speculation that a peace deal could reopen more Russian barrels, continue to weigh on sentiment. However, many traders believe that without a tangible increase in physical supply, the impact of the Ukraine peace on the oil market could take time.
In the short term, price movements are likely to remain limited. Market liquidity tends to be thin due to the US holiday, while market participants are choosing to await confirmation from two major factors: the outcome of Ukraine-Russia diplomacy and the official OPEC+ decision later this week. The combination of the two will determine whether oil maintains its current level, continues its downtrend, or reverses if supply risks resurface. (asd)
Source: Newsmaker.id
