Crude Futures inch Higher before OPEC

Crude oil futures inched higher during the early Asian trade session in Wednesday.

Traders are looking forward to this week’s meeting, in Vienna, of the Organization of the Petroleum Exporting Countries (OPEC) and their non-member allies led by Russia, known as the OPEC +.

Oil traders are also digesting a bigger than expected contraction in oil inventory levels in the United States last week.

As of 2:50 am GMT, the international benchmark, Brent crude oil futures contract was up 0.6 percent to trade at $61.17 a barrel.

U.S. West Texas Intermediate (WTI) crude futures, for front end delivery, also traded higher. This contract added 31 cents to trade at $56.41.

Crude Oil Traders Monitor Inventory Data and wait on OPEC to Meet

This week, the Organization of the Petroleum Exporting Countries (OPEC), and its non-member allies led by Russia, will meet to discuss supply cuts and reducing production further. This is according to Iraq.

Iraq is the second largest oil producer in OPEC and their oil minister, Thamer Ghadhban, said yesterday that “a deeper cut is being preferred by a number of key members.”

On Thursday, OPEC members meet. On Friday, OPEC + meets.

OPEC + nations have been curbing output since 2017 to balance oil prices and reign in a global supply glut. However, record production out of the United States has not been helpful.

U.S. data on inventory, from the private American Petroleum Institute (API) released yesterday showed that the oil stockpiles fell by 3.7 million barrels. This was more than double what the markets expected at 1.7 million barrels drawdown.

Traders will also monitor key Institute for Supply Management (ISM) non-manufacturing (services) producer managers’ index (PMI) for the month of November. Traders are expecting this number to contract from the month of October from 54.7 to 54.5 for November. Close attention will be paid to the services sector job growth.