Comments from Novak appear to be weighing on crude
- Russia is strictly complying with the OPEC+ deal
- Now it is important to keep global oil market balanced, to synchronise output and demand as the market rebounds
- OPEC+ fulfilled the task of removing surplus from the global oil market
- Sees global oil demand growing by 5.8-6 million barrels per day in 2021
- Russian oil companies are ready to increase oil production beyond the rates and volumes set by OPEC+
- Now it is important to keep global oil market balanced, to synchronize output and demand as market rebounds
OECD inventories are below the 5-year average now but an OPEC committee had this chart yesterday, showing that if plans to restore output in 2022 continue then there could quickly be oversupply.
Today's JMMC is at 10 am ET and the OPEC+ meeting is an hour later. The chance of any change from the plan to add 400k bpd is low.
Oil is selling off at the moment:
The comment about Russian oil companies increasing production may be the catalyst. However that could be some classic Russian propaganda. Last month, data showed Russia didn't raise production to meet their higher quota and there's long been speculation that they (and Saudi Arabia) aren't capable of producing at their stated full speed beyond a month or two.
The declines in WTI have extended to $67.40.
