Oil prices boomerang on OPEC headlines
Add Axios as your preferred source to
see more of our stories on Google.
Oil prices whipsawed Monday as news about what the OPEC oil price cartel would decide at its meeting next month sent traders scurrying.
Driving the news: A story in the Wall Street Journal, suggesting that OPEC was considering a 500,000 barrel-a-day increase in production, jolted the crude oil markets at around 9 am ET.
U.S. benchmark crude oil prices fell more than 5% in response, to about $75 a barrel.
Context: The news came as a surprise to oil industry observers, especially in light of the fact that just last month, OPEC and its petro-ally Russia announced plans to cut oil production sharply in an effort to prop up prices.
But, but, but: A statement from Saudi Arabian Authorities later in the day seemed to knock down the Journal's reporting.
What they're saying: “The current cut of 2 million barrels per day by OPEC+ continues until the end of 2023,” Saudi Energy Minister Prince Abdulaziz bin Salman said in a statement issued by the Saudi Press Agency.
- Oil prices promptly reversed course and surged, briefly going positive before ending the day down less than half a percentage point, at just under $80 a barrel. (They're up another 1% Tuesday morning to about $81.)
The bottom line: If the trading activity is any indication, the actual announcement from OPEC and Russia after a meeting on Dec. 4 in Vienna could be a real market mover.
