Storm In The Black Sea Affects Oil Supply, OPEC+ Needs To Be Prepared

<p>&nbsp;Crude oil supply movement rose slightly at the opening today as investors remained cautiously awaiting the crucial OPEC+ meeting to decide production levels in addition to supply disruptions in the Black Sea putting pressure on prices.</p><p><br /></p><p>Brent crude fell three cents to $81.65 a barrel and the U.S. West Texas Intermediate managed to rise 12 cents (0.2%) to $76.53 a barrel.</p><p><br /></p><p>Both crudes gained about 2% yesterday following the Organization of the Petroleum Exporting Countries and Russia (OPEC+) to extend or fine-tune supply cuts as well as concerns over Kazakhstan's oil production and the weakness of the US dollar.</p><p><br /></p><p>According to Hiroyuki Kikukawa, President of NS Trading, the Nissan Securities unit believes that investors will be ready to sell positions ahead of the OPEC+ meeting at the time of disruption from Kazakhstan. All eyes are on OPEC+ policy and demand towards the end of 2024.</p><p><br /></p><p><br /></p><p>Still, the WTI market is expected to hover around $76 with a $5 range for a while unless OPEC+ resumes significant supply cuts.</p><p><br /></p><p>In addition, Warren Patterson and Ewa Manthey, analysts from ING bank said that if OPEC+ fails to reach an initial agreement. There is likely to be a risk of the meeting being postponed and will continue to put pressure on oil prices.</p><p><br /></p><p>Recently, a devastating storm in the Black Sea region has disrupted the supply of up to 2 million barrels per day for export from Kazakhstan and Russia. Indirectly, it raises concerns about short-term supply shortages.</p><p><br /></p><p>A report by the Ministry of Energy of Kazakhstan mentions that the country's largest oil-producing region has reduced daily oil supply by 56% since November 27.</p><p><br /></p><p>Meanwhile, US crude inventories fell by 817,000 last week and many analysts estimate on average that crude inventories fell by about 900,000 barrels in the week since November 24.</p>