The meeting comes shortly after the Suez Canal reopened to traffic and as the coronavirus continues to spread worldwide, with French President Emmanuel Macron ordering the country into its third national lock down to alleviate some of the pressure on hospitals. The ongoing coronavirus crisis continues to cloud the demand outlook and analysts expect this to reaffirm Saudi Arabia’s caution about the global economic recovery.
Ahead of the meeting, analysts thought the group would keep production levels consistent. Analysts at Eurasia Group noted that the last month in global oil markets “featured a significant level of volatility” and a sell-off that brought Brent crude futures down to $62 a barrel from $70, before stabilizing around $64 in recent days. “The Suez Canal incident probably helped many oil producers, as it prevented a further slide in prices,” analysts at Eurasia Group said in a research note published Wednesday.
“Once again, it is far from clear that a sustainable recovery would justify a strong cycle of OPEC+ tapering to be followed each month. Saudi Arabia’s caution about the global economic recovery was in many respects warranted,” they added. International benchmark Brent Crude Futures gained $2.38, or 3.8%, to trade at $65.08 per barrel. U.S. WTI Crude futures settled at $61.45, up more than 4%. Both contracts had previously traded in the red during the session.
