Oil retreats on signs of OPEC+ discord ahead of key meeting

Oil dropped below $45/bbl as a consensus within OPEC+ to postpone an output hike planned for January remained elusive ahead of a meeting of the cartel’s power brokers later on Monday.

West Texas Intermediate crude for January delivery fell 75 cents to US$44.78/bbl as of 10:28 a.m. London time. Prices are up about 25 per cent this month.

Brent for January settlement slid two per cent to $47.24.

Most participants in an informal online gathering of OPEC+ ministers on Sunday supported keeping production curbs at current levels into the first quarter, said one delegate, although there was opposition from the United Arab Emirates and Kazakhstan.

Oil is still set for the biggest monthly gain since May as Covid-19 vaccine breakthroughs raised optimism for a long-term rebound in fuel consumption. Yet failure by OPEC+ to agree on extending output curbs would see producers restore about 1.9 million bbls/d in supply, potentially pushing the global market back into surplus.

© 2020 Bloomberg L.P.

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