Oil prices to open lower on Monday amid Saudi-Russian dispute over production, but decline may be muted over a possible agreement
This file photo taken on September 20, 2019 shows employees of Aramco oil company working in Saudi Arabia's Abqaiq oil processing plant.
Saudi Arabia's decision to postpone its posting of the international prices for its crude for the first time indicates that it is not eager to flood the market with low-priced crude before a potential agreement. "That's a pretty clear sign that they are open to cutting production in May," McNally said.
OPEC and its allies postponed an emergency meeting scheduled for Monday, led by Saudi Arabia, where the oil cuts could be agreed upon. A senior Saudi source told Reuters on Sunday that the kingdom would now host the meeting via videoconference on Thursday and the delay was to allow more time to bring other producers on board.
The sharp rebound from weeks of losses came after Trump said Moscow and Riyadh would negotiate to end a price war that slashed prices by more than half last month. "Given the slimmer chances of a deal, prices are likely to give up the gains made last week that were a short-covering rally induced by Trump's comments," said Amrita Sen, co-founder of the Energy Aspects consultancy.
Per Magnus Nysveen, head of analysis at Rystad Energy, said the decline in global demand because of the coronavirus pandemic and the global lockdowns was larger than the proposed cuts by the OPEC+ alliance.
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