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Oil Drops Below $80 in Wild Reversal After OPEC Keeps Production Steady

CommoditiesNov 04, 2021 03:23PM ET
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© Reuters.

By Yasin Ebrahim

Investing.com - Oil prices settled lower Thursday after giving up gains on profit taking following the decision by OPEC and its allies to stick their plan to gradually boost production, defying calls from President Joe Biden to ramp-up production.

On the New York Mercantile Exchange, crude futures fell $2.05 to settle at $78.81 a barrel, while on London's Intercontinental Exchange (NYSE:ICE), Brent slipped $1.45 to to trade at $80.54 a barrel.

OPEC and its allies including Russia decided to stick with their previous plan to raise oil production by a 400,000 barrels a day next month.

Biden earlier this week blamed the rise in energy prices on "the refusal of Russia or the OPEC nations to pump more oil."

The major oil producers, however, weren't willing to heed the president's calls, insisting that its current production accord would foster “a stable and balanced oil market."

The White House hit back against the oil cartel and its allies' decision, saying the "global recovery should not be imperiled by a mismatch between supply and demand. OPEC+ seems unwilling to use the capacity and power it has now at this critical moment of global recovery."

The remarks from the White House stoked concerns that the U.S. could take measures including releasing strategic petroleum reserves to boost production and cap prices.

Also souring sentiment on oil, Saudi Energy Minister Prince Abdulaziz bin Salman stoked concerns about the oil demand outlook after reportedly saying that oil inventories would see "tremendous" builds at the end of 2021 and early 2022, according to an Al Arabiya TV report.

Oil Drops Below $80 in Wild Reversal After OPEC Keeps Production Steady
 

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Comments (9)
Young Money
Young Money Nov 04, 2021 9:33PM ET
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Trump set us up for this, we all saw it coming. Loving putin, signing a treaty to pull out of iraq removing US troops on the ground giving saudis the security they wanted to push back on us
Steven king
Steven king Nov 04, 2021 9:33PM ET
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Trump lives in your head.. He is not running things. call Brandon
Peter Simpson
Padraic Nov 04, 2021 8:24PM ET
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What oil / gas prices development can we expect after this decision?
Young Money
Young Money Nov 04, 2021 8:24PM ET
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Hard to say, inventories in the US havent been draining as fast in the US and i think thats due to price
Michael Mcdonough
Michael Mcdonough Nov 04, 2021 8:20PM ET
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I think they waiting for John Kerry to beg for more oil..or was it more wind…ha!
Rasp Trade
Rasp Trade Nov 04, 2021 4:58PM ET
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Trump was begging to cut production , biden to boost Lol
Karl Kessler
Karl Kessler Nov 04, 2021 4:46PM ET
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The president is jawboning OPEC to produce more fossil fuels at the same time he's saying he's serious about emissions. He should be happy that OPEC has decided to ration fuel, right? (Rolling eyes). This is why the two parties have such low approvals.
Jo Riley
Jo Riley Nov 04, 2021 4:46PM ET
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?? What does any of this have to do with 2 parties?  There is 1 US Marxist/Democrat party in charge of everything now.  They have the president, and a majority in both houses.  Sorry, no one else to blame.  They have by themselves, in a few months of control, crushed US supply.  Lower supply = higher world prices.  The world can congratulate them:  green delusions + ineptness = poorer people paying more for gas & turning blue this winter.
Venkat Raman
Venkat Raman Nov 04, 2021 4:35PM ET
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Everyone is focused in the here & now. Nobody takes the time to do quality research and dig down deep into why we are in this situation. Far from blaming Biden or Trump or some government (noise) the truth lies around (a) no plan around transition from fossil to clean (anywhere in the world) (b) shareholders have gotten burned with fossil fuel companies in the past decade (& last year was brutal). They demand these companies to be good allocators of capital so they can attract capital again. So downstream and upstream companies are taking a responsible path towards becoming CF positive & focussing on margin expansion. (c) Regulatory & posturing around the world towards ESG (although I think it is more lip service than anything else) are headwinds.
MK MK
MK MK Nov 04, 2021 4:26PM ET
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Bring down prices by hiking rates, greedy bustards, it is so easy. Fire Powell immediately
Southern Tiger
Southern Tiger Nov 04, 2021 4:06PM ET
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Since the DNC: they want to permote the Green New Deal, why not boycott all focal fule from coming into this country?
Karl Kessler
Karl Kessler Nov 04, 2021 4:06PM ET
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Because they don't mean what they say.
Barani Krishnan
Barani Krishnan Nov 04, 2021 3:45PM ET
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Don't worry. The Salman brothers will think of other 'creative' ways to inflate the market :)
 
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