Oil prices dipped by 1% on Thursday as OPEC+ unexpectedly postponed its scheduled meeting on production cuts.
Brent crude oil, against which Nigerian oil is priced, declined by 49 cents to settle at $81.96 a barrel, while the U.S. West Texas Intermediate crude shed 67 cents to close at $77.10.
The surprise delay of the OPEC+ meeting, initially slated for November 26 but now rescheduled for November 30, prompted an early sharp drop in prices.
The meeting, involving major producers such as Saudi Arabia and Russia, was anticipated to discuss potential adjustments to the existing deal that limits oil supply into 2024.
Dennis Kissler, Senior Vice President of Trading at BOK Financial, noted that concerns about increased production from oil producers in the coming months contributed to the market unease.
Also, a rise in U.S. crude inventories by 8.7 million barrels, reported by the Energy Information Administration, further pressured prices.
The unexpected delay sparked worries about a potential surplus in oil supply, prompting speculation about the need for OPEC+ to not only extend but increase production cuts to stabilize prices.
The fluctuating market conditions reflect the delicate balance of global oil dynamics and underscore the influence of geopolitical decisions on the energy sector.
