Following the unexpected decision by OPEC+ to postpone a crucial policy meeting, which suggested new division within the group, oil prices fell further lower on Thursday.
While everything was going on, stock markets saw uneven trading as two US data cast doubt on the current frenzy over interest rate developments.
The announcement that the highly anticipated meeting of OPEC+, an alliance of major producers led by Saudi Arabia and Russia, would be postponed by four days until November 30 caused both of the major oil contracts to decline.
After plunging about five percent on Wednesday in the wake of the announcement, prices fell by an additional one percent on Thursday.
According to reports, Saudi Arabia was getting ready to extend a one-million-barrel-a-day output cut into the new year after Angola and Nigeria resisted lower limits that were pushed by others.
Massive price cuts were announced earlier this year by Riyadh and Moscow in an attempt to raise prices, which have been under pressure due to the faltering economies of the US, Europe, and China in particular.
According to SPI Asset Management analyst Stephen Innes, “Oil prices fell after OPEC reported a delay in the weekend, a meeting which hints at a growing rift among OPEC+ producers.”
It should come as no surprise that producers want to pump more oil rather than reduce output since they are afraid of losing even a little portion of the market share given the surge in US and non-OPEC production.
“And there’s hope for some stability in the region thanks to the ceasefire in the Israel-Hamas war.”
Stocks Differ
European and Asian equity markets were erratic, even following Wall Street’s latest pre-Thanksgiving rally.
After losing ground in the morning, Hong Kong managed to gain ground in the afternoon, with developers leading the way as it became clear that China is getting ready to provide further assistance to the real estate sector and is urging banks to help the sector more.
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This followed a report by Bloomberg News on Wednesday stating that officials had compiled a preliminary list of 50 companies that might qualify for additional financial assistance.
While Sydney, Singapore, Taipei, Manila, Bangkok, and Seoul all declined, Shanghai, Seoul, Wellington, Mumbai, and Jakarta all rose in other places.
While markets in Paris and Frankfurt also saw gains, London saw some little losses as the half-way point approached.
The lacklustre results were caused by statistics indicating that US consumers’ expectations for inflation over the next year had increased, from 4.4 percent to 4.5 percent, according to University of Michigan research.
In a related development, US jobless claims were substantially lower than anticipated, indicating the strength of the labour market.
The Federal Reserve has stated time and time again that data, especially those related to jobs and inflation, will be used to determine interest rates.
Brent North Sea crude: DOWN 1.0 percent at $81.11 per barrel
West Texas Intermediate: DOWN 1.0 percent at $76.34 per barrel
London – FTSE 100: DOWN 0.1 percent at 7,462.29 points
Paris – CAC 40: UP 0.2 percent at 7,277.67
Frankfurt – DAX: UP 0.1 percent at 15,977.72
EURO STOXX 50: UP 0.1 percent at 4,357.14
Hong Kong – Hang Seng Index: UP 1.0 percent at 17,910.84 (close)
Shanghai – Composite: UP 0.6 percent at 3,061.86 (close)
Tokyo – Nikkei 225: Closed for a holiday
New York – DOW: UP 0.5 percent at 35,273.03 (close)
Euro/dollar: UP at $1.0920 from $1.0888 on Wednesday
Dollar/yen: UP at 149.24 yen from 148.54 yen
Pound/dollar: DOWN at $1.2550 from $1.2594
Euro/pound: DOWN at 87.00 pence from 87.14 pence
AFP
