The sentiment on the oil market is as bullish as it has been in years, but analysts are divided-as usual-on whether this bullishness is entirely due to market fundamentals and whether the bulls will feel the sting of an imminent oil price correction.
If oil prices don't fall much from their current levels until the November 30 meeting, some OPEC producers, as well as Russia, could be reluctant to commit to specifics until they see how the market will look like in early 2018.
FLOATING STORAGE: The amount of oil stored on tankers around Singapore has dropped sharply in the last months, the latest indication that OPEC-led supply cuts are successfully tightening crude markets even as U.S. exports have soared.
Both contracts were rose more than 2 percent this week, which was the fifth consecutive increase. "We're on our way to set record crude oil production in 2018", said Andrew Lipow, president of Lipow Oil Associates in Houston. Unease grew, after a rocket was fired from Yemen towards Saudi Arabia.
Shale oil is a type of crude oil usually found in shale and limestone rock deposits and extracted through hydraulic fracturing.
Overall, I think prices are currently approaching the higher end of the trading range for the rest of the year, and will be looking for a mean reversion towards or below $60 in the weeks to come.
Now, however, geopolitical tensions have taken over as the main driver, pushing the oil price even higher.
OPEC's mission to draw down bloated global oil inventories with production cuts came at a time when global economic growth is strong and oil demand growth is stronger than previously expected. There will be a lot of resistance to change. The potential further increase in oil price, buoyed by the situation in Saudi Arabia, may influence the upcoming negotiations but is unlikely to tank the deal.
The Saudi Crown Prince, Mohammad Bin Salman, coordinated the arrest of a number of princes and ministers, on corruption charges.
IRAQ: Iraq will be the last Middle East producer to announce its monthly prices this month. "But I think as things stand, they will be able to reach an agreement in the November meeting", the senior lecturer in Energy Economics, Xiaoyi Mu, has concluded.
The dollar index is poised for further gains after an aggressive downside rejection on Thursday.