Oil Tumbles After OPEC+ Meeting Delayed

Oil prices are lower this morning as the usual malarkey of leaks, rumors, and denials dominates price action ahead of the planned OPEC+ meeting this weekend.

The selling started with a report by Bloomberg claiming that the Saudis expressed dissatisfaction with other members about their oil production levels.

The worry, Bloomberg claims, is that Riyadh might reverse its unilateral 1 million barrel-a-day curb if its counterparts don’t contribute further to the supply reductions.

That sent prices lower.

Then, at 0801ET this headline hit:

OPEC+ MEETING TO GO AHEAD ON SUNDAY AS PLANNED - RIA

Then at 0806ET, this headline hit:

*OPEC+ MEETING SCHEDULED FOR WEEKEND HAS BEEN DELAYED: DELEGATES

And prices legged lower still...

We remind readers that while Goldman's base case is that Saudi Arabia and Russia will announce an extension of their extra voluntary cuts through at least 2024Q1 (because Brent is $8 lower than when they announced an extension in September), they see a sizeable 35% subjective probability of an announcement of a deeper group cut.

Policymakers may take out insurance against the possibility that Brent drops below our $80/bbl estimate of the OPEC put in Q1 when demand is seasonably softer.

A deeper group cut appears more likely than a deeper unilateral cut because only the former tends to boost revenues.

OPEC has confirmed that the meeting is delayed until Nov 30th.