Analysts concede the market is now in a holding pattern: file Image/Pixabay
Oil prices on Thursday dropped moderately after a highly-anticipated Organization of the Petroleum Exporting Countries (OPEC) meeting yielded no decision on deepening crude supply cuts to deal with a perceived decline in world demand - even though evidence of such a decline is spotty at best.
Specifically, prince Abdulaziz bin Salman, the new energy minister for Saudi Arabia, said deeper cuts would not be decided upon before another OPEC meeting planned for December; this despite OPEC issuing a statement saying oil stocks in industrial countries remained above the five-year average, and Oman's energy minister saying that "the outlook is not very good for 2020."
However, OPEC did address concerns somewhat by agreeing on Thursday to ask over-producers Iraq and Nigeria to bring their production in line with targets.
Phillip Streible, RJO Futures
Now we're just back-pedaling
The crude price losses were also spurred by doubt about the U.S. and China resolving their mutual hostilities, which occurred after Washington denied a Bloomberg News report that it was considering a temporary trade agreement with Beijing.
Brent settled at $60.38 per barrel, shedding 43 cents, while West Texas Intermediate settled at $55.09 per barrel, losing 66 cents.
Phillip Streible, senior commodities strategist at RJO Futures, said, "Now we're just back-pedaling and cautiously waiting for the next development in the market, whether it be from economic data, more verbiage from OPEC, and we're still going to monitor inventories as a whole."
But shortly after the end of Thursday trading day, that verbiage - unsurprisingly negative - kicked into gear when it was reported that OPEC along with the International Energy Agency and the Energy Information Administration all seeing the biggest oil inventory draws for 2019 happening right now.
According to the trio, the outflows will start to slow from October, and next year further stock builds will develop.