London, Dec. 3, 2024 – Oil edged higher ahead of an OPEC+ supply meeting on Thursday, with wider markets buoyed by hopes China’s leadership will approve more stimulus at a major meeting next week.
Brent crude traded near $72 a barrel after ending just 1 cent lower on Monday, with West Texas Intermediate above $68.
The recent lackluster price action has sent gauges of implied volatility in the two benchmarks to the lowest in about two months.
Traders still expect the producer group to further delay restoring some production due to concerns of a glut next year.
Meanwhile, China’s top leaders plan to start the annual closed-door Central Economic Work Conference next Wednesday to map out economic targets and stimulus plans for 2025, according to people familiar with the matter.
Futures have been trading in a range of a little more than $6 since mid-October, buffeted by geopolitical developments in the Middle East and Russia and the demand outlook in China, the biggest oil importer.
“Despite the ongoing cross-currents we’ve hit a fair value that looks sticky for the short term” with Brent at current levels, said Chris Weston, the head of research for Pepperstone Group.
“For now, the oil market is happy to massage positions and prepare to react should new news break.”
In the Middle East, Israel said it’s still committed to a ceasefire after carrying out airstrikes in Lebanon in response to Hezbollah’s first attack under the truce. In Syria, meanwhile, a conflict has flared up as rebels attacked key cities.
Elsewhere, colder-than-usual temperatures in Europe at the start of the Northern Hemisphere winter have led to a flicker of bullishness in diesel, which includes heating oil still commonly used in the region.
Speculators cut short positions for the refined product for a fourth consecutive week, the longest such run since February. (Bloomberg)
