(New York) Oil prices fell on Thursday, influenced by the firedamp on Wall Street, fed by the anxiety of a coming recession which would contract the demand for black gold.
Posted at 3:22 p.m.
A barrel of Brent North Sea oil for November delivery fell 0.92% to close at $88.49.
The barrel of American West Texas Intermediate (WTI), also with maturity in November, lost 1.11% to 81.23 dollars.
The session will have been very volatile and the prices were still rising a few minutes from the close, before dropping out.
“With the equity markets falling, crude prices have been carried away by the pessimism” of the stock markets, commented Matt Smith of Kpler.
“The mood is really gloomy,” insisted the analyst. Operators “are very concerned about the recession”, which would slow demand for oil and refined products.
If crude did not fall further on Thursday, it is “perhaps thanks to OPEC”, whose market is waiting for a gesture “to support and stabilize prices”, according to Matt Smith.
The Organization of the Petroleum Exporting Countries (OPEC) and its allies in the OPEC+ agreement are due to meet on October 5 to determine a production level for November.
Analysts are counting on a drop, probably greater than that decided at the beginning of September for October, or 100,000 barrels less per day.
“OPEC will have to cut volumes by 500,000 to one million barrels a day to keep prices around $90 a barrel” of Brent crude, Gary Ross of Black Gold Investors said in a note, a range taken up by other analysts.
“It would take a significant drop” to react to the prices of black gold, abounds Matt Smith. The strong dollar, whose rise on Thursday again penalized prices, “has heightened concerns within the cartel and it seems increasingly determined to defend high prices”, says Quincy Krosby of LPL Financial.
The credibility of the cartel is nevertheless in question, as OPEC+ missed its production target of 3.58 million barrels per day in August, due to a lack of sufficient capacity.
For Matt Smith, the pivot of OPEC + would only be convincing if the contraction in production was above all assumed by the members whose volumes are in line with the objectives, mainly Saudi Arabia and the United Arab Emirates.