Oil jumps into positive territory on report OPEC+ will ‘seriously consider’ output cut

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It’s been quite a day in the oil market.

Crude oil

Crude oil

Crude oil is the most popular tradable instrument in the energy sector, offering exposure to global market conditions, geopolitical risk and the economy. The instrument is strategically reliable and located in the global economy. Crude oil has proven to be a unique choice for traders given volatility and the effectiveness of both swing trading and longer term strategies. Despite its popularity, oil is a very complex investment instrument, given the litany of fluctuations in oil prices, risk and impact of policy stemming from OPEC. Short for the Organization of the Petroleum Exporting Countries, OPEC operates as an intergovernmental organization of 13 countries, helping to set up and dictate the global oil market. How to Trade Crude Oil Crude oil is most often traded as an exchange-traded fund (ETF) or through other instruments with exposure to it. This includes energy stocks, the USD/CAD and other investment options. Oil itself is traded through a duality of markets, including the West Texas Intermediate Crude (WTI) and Brent crude oil. Brent has been the more dependent on the index in recent years, while WTI is more heavily traded through futures trading at the time of writing. Aside from geopolitical events or OPEC decisions, oil can move in a variety of different ways. The most basic is through simple supply and demand, which is affected by global production. Increased industrial production, economic prosperity and other factors all play a role in crude prices. By extension, recessions, lockouts or other stifling factors can also affect crude prices. For example, excess supply or softened demand due to the aforementioned factors would result in lower crude prices. This is due to traders selling oil futures or other instruments. If demand increases or production plateaus, traders will bid more and more for crude, thereby driving up prices.

Crude oil is the most popular tradable instrument in the energy sector, offering exposure to global market conditions, geopolitical risk and the economy. The instrument is strategically reliable and located in the global economy. Crude oil has proven to be a unique choice for traders given volatility and the effectiveness of both swing trading and longer term strategies. Despite its popularity, oil is a very complex investment instrument, given the litany of fluctuations in oil prices, risk and impact of policy stemming from OPEC. Short for the Organization of the Petroleum Exporting Countries, OPEC operates as an intergovernmental organization of 13 countries, helping to set up and dictate the global oil market. How to Trade Crude Oil Crude oil is most often traded as an exchange-traded fund (ETF) or through other instruments with exposure to it. This includes energy stocks, the USD/CAD and other investment options. Oil itself is traded through a duality of markets, including the West Texas Intermediate Crude (WTI) and Brent crude oil. Brent has been the more dependent on the index in recent years, while WTI is more heavily traded through futures trading at the time of writing. Aside from geopolitical events or OPEC decisions, oil can move in a variety of different ways. The most basic is through simple supply and demand, which is affected by global production. Increased industrial production, economic prosperity and other factors all play a role in crude prices. By extension, recessions, lockouts or other stifling factors can also affect crude prices. For example, excess supply or softened demand due to the aforementioned factors would result in lower crude prices. This is due to traders selling oil futures or other instruments. If demand increases or production plateaus, traders will bid more and more for crude, thereby driving up prices.
Read this Term is now positive on the day at $76.91 from a low of $73.60 and it comes after analysts at the Eurasian Group said OPEC+ would “seriously consider” a production cut next week.

I haven’t seen the report myself but Eurasian Group is not one of the usual OPEC escapees so I would treat this one carefully.

Update, it’s definitely speculation:

“Given general market conditions, OPEC+ will seriously consider a new production cut at its next meeting, especially if crude prices fall well below their current level in the coming week,” analysts at Eurasia Group say in a report.

“Ultimately, the decision will depend on the trajectory of the oil price when OPEC+ meets and how much disruption is evident in markets due to the EU sanctions”

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