The prices of crude oil have steadied a bit lower than last week’s close today. This is likely due to traders preparing for the upcoming OPEC meeting next week. The petroleum-exporting countries will meet on November 30 to decide whether to extend their agreement to keep oil supply low into 2018.
The original OPEC agreement will expire soon. That monumental decision by OPEC last year had a dramatic effect on the oil market, allowing oil prices to consistently increase, from their levels below $40 per barrel to now over $60. The measure has proven very successful, and has even been adopted by non-OPEC states such as Russia, who also has an interest in stabilizing the oil market and pushing the black gold towards higher prices.
Nevertheless, analysts have warned that the market for oil is far from stable. The United States still has the capability to offset OPEC’s efforts by increasing its production of shale oil, a much more cost-effective alternative to crude. Experts have warned that OPEC must continue with its restrictions possibly until the end of 2018 before we can say that the oil crisis is behind us.
Earlier today the Brent crude was trading around $62.38, while the WTI was at $56.48.
