Earlier this week the price for crude oil suffered a drop as it was revealed that the United States’ oil reserve exceed expectations, and US officials further announced the increase of shale oil output for a twelfth consecutive month.
The low costs of shale oil extraction in the United States have long been a major reason why the prices of oil stayed low for most of 2015 and 2016. This year they have been on their path to recovery, thanks to OPEC’s agreement to reduce oil extraction and exports.
The drop in the price from earlier this week now seems overshadowed by investors’ anticipation of the upcoming OPEC meeting on November 30. It is expected that the oil exporting countries will decide to extend their agreement into 2018 and commit to working for the rebalancing of the oil market even further.
The news drove oil prices to $61.73 for the Brent benchmark and $55.26 for the WTI.
Even though officials from OPEC members and Russia have indicated a desire to continue the agreement, if for some reason they do not, the oil market will be shaken and prices will likely fall below $60 again.
