OPEC: Speculators Played a Key Role in Decline of Futures Prices

The Organization of the Petroleum Exporting Countries (OPEC) expressed cautious optimism today, Wednesday, regarding the fundamental factors affecting the oil market in 2024. It noted that the recent price decline is due to "exaggerated fears" about demand, while maintaining its relatively high forecasts for oil consumption in 2024. Brent crude fell to its lowest level in six months, nearing $72 per barrel, down from its 2023 peak of around $98 per barrel reached in September. The price decline has been exacerbated since the "OPEC+" alliance, which includes OPEC and other allies led by Russia, announced a new round of production cuts on November 30. However, OPEC stated in its monthly report that it remains "cautiously optimistic about the fundamental factors affecting the dynamics of the oil market in 2024," clarifying that speculators have played a key role in pushing prices down. On his part, OPEC's Secretary General, Haitham Al-Ghais, said in a statement today that the oil sector is at risk in the absence of adequate investment levels. He congratulated the UAE on the positive outcomes of the COP28 climate conference.