​Oil Seeks Potential Support as OPEC+ Considers Delay to Output Increase

WikiFX News (16 Nov.) - Oil prices ended higher 7.30% last week, recording gains for two consecutive weeks, despite the previously sharp retreat of 7% from a monthly high of $43.05. Oil may find its downtrend hard to sustain as more support for future trading is on the way.

On Sunday, the ten ASEAN countries as well as Japan, South Korea and New Zealand formally signed the Regional Comprehensive Economic Partnership (RCEP) agreement, the world's largest free trade agreement, which eases global trade tensions.

Besides the Fed's emphasis on long-term loose monetary policy, the progress in the vaccine also encourages the market to expect a rally in risk assets, such as crude oil, once the inflection point of the pandemic occurs.

Looking ahead, the OPEC+ ministerial meeting will take place this Tuesday. The latest news shows that OPEC+ is zeroing in on a delay to next year's planned oil-output increase, which may help oil prices reclaim some lost ground.

Oil prices are likely to seek some support in the $39.30-40.0 area. If a firmer footing is effectively established above $39.30, the potential challenge to $43.0 or even $45.0 could be on the radar.

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Chart: Trend of WTI Crude Oil