Oil prices have experienced volatility as they trade sideways, with market participants awaiting the outcome of an OPEC+ meeting later this week.
Traders are likely adopting a “wait-and-see” stance, anticipating that OPEC+ will extend its current output cuts through the first quarter of 2025. While this extension may offer some short-term support, concerns over a potential oversupply in the market are placing downward pressure on prices. The broader market sentiment suggests a bearish outlook for global crude prices in the near to medium term, as the prospect of oversupply limits any significant upside.
The outlook for oil consumption remains weak, particularly as China’s demand is expected to peak, worsening the supply-demand imbalance. Additionally, Saudi Arabia is anticipated to reduce crude prices for Asian buyers, further dampening market sentiment. The U.S. Federal Reserve’s decision to potentially hold off on rate cuts in December could also weigh on oil prices. Despite these challenges, geopolitical tensions continue to add uncertainty to the global crude market, further complicating the price outlook.
