MW Oil edges lower as focus turns to OPEC response to Trump's call for more output

By William Watts

Oil futures steadied Thursday, a day after the U.S. benchmark saw its lowest settlement of the new year, as traders turned their attention to a meeting of ministers from OPEC+ - made up of the Organization of the Petroleum Exporting Countries and its allies - and their response to President Trump's call for increased production.

Price moves

-- West Texas Intermediate crude CL00 for March delivery CL.1 CLH25 was off 3 cents, or less than 0.1%, at $72.59 a barrel on the New York Mercantile Exchange. The front-month WTI contract ended Wednesday at its lowest since Dec. 31.

-- March Brent crude BRNH25, the global benchmark, was up 1 cent at $75.62 a barrel on ICE Futures Europe. The more actively traded April contract BRN00 BRNJ25 was flat at $75.61 a barrel.

Market drivers

Trump, in a speech delivered remotely to the World Economic Forum's annual meeting in Davos, Switzerland, last week, called on Saudi Arabia and OPEC to boost oil production and bring down prices. OPEC+ members haven't responded publicly, but top ministers are due to meet Monday in a regularly scheduled online meeting.

OPEC+ previously laid out a plan that would see the unwind of some production cuts beginning in April. Those measures, which had initially been set to take effect in the final quarter of last year, were repeatedly delayed amid oil-price weakness.

In the oil market, "bearish momentum appears to be gaining strength," with Trump putting pressure on OPEC+, Robert Yawger, executive director for energy futures at Mizuho Securities, said in a note.

"My guess is that OPEC+ will reiterate that they are going to start unwinding 2.2 million bpd of production cuts starting in April, with monthly increases of 138,000 bpd (barrels per day) and lasting 18 months until September 2026," he said.

He noted the United Arab Emirates is also scheduled to begin adding a total of 300,000 bpd from April through September 2026. OPEC+ is also likely to add language indicating they plan to follow through with the April plan and not offer further delays, and could also move to add a few barrels per month by shrinking the timeline for the gradual unwind of production cuts, he said.

Commodities Corner: Trump may have given the Saudis and OPEC the excuse they needed to boost oil production

-William Watts

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January 30, 2025 06:59 ET (11:59 GMT)

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