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The OPECís decision is a fork for oil prices: either $55 or $40 per barrel

The volatility of oil price quotations has grown significantly recently. The investors are trying to guess what OPEC member countries will decide on November 30. Gold prices go down.

28.Nov.16 4:01 AM
By Anna Tuzova


The OPECís decision is a fork for oil prices: either $55 or $40 per barrel
The price for Brent remains relatively high for now, over 47 dollars per barrel. It is expected that the OPECís decision and the USAís oil stock data, which will be published on November 30 as well, will predetermine the oil price dynamics till the end of 2016: either it will be $55pb (per barrel), or $40pb , according to an analyst.

In commodity markets the effect of the growing strength of the US dollar was balanced with hopes for the increased expenditure. Precious metals prices are going down against a background of a growing dollar and stocks. The Brazilian realís depreciation has provoked the reduction of long speculative positions on the coffee and sugar markets.

The US dollar growth, in general, usually produces the negative effect. However, the expected increase in expenditure (not only in China) and the alleged OPECís deal have supported the industrial metals segment and the energy market up to now.

The precious metals market has shown the most significant decline. A demand for gold and silver as the alternative, reliable investment instruments has fallen. The largest reduction had been recorded in a four week period since July 2013, as measured by investments to exchange-traded funds, and gold prices has reached the level, where the future of almost one year trend upwards is in doubt.

The meeting of OPEC member countries, in which the oil output cut will be discussed, will be held on November 30 in Wien.

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