Oil Price Sustains Gain As Brent Crude Rises To $59.36 Per Barrel

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Under pressure from angry senators and other Washington power players, he needs Trump's political protection.

The market kept a close eye on what signs of the global oil policy will come out from the gathering of world' s major oil producers at the G20 Summit, scheduled for November 30 to December 1, especially among heads of states of Saudi Arabia, Russia and the United States.

If the past is any guide, however, Saudi Arabia will do most of the cutting, Russia's output will end up little changed, and the main beneficiaries will be US shale firms. "Against this backdrop, the most likely outcome of next week's OPEC meeting is a fudge". This time around the activity has been muted as officials say they are waiting for clarity from Buenos Aires. USA crude was unchanged at $51.45.

The price even broke the $50.00 support area and traded as low as $49.49.

The U.S., which is been pumping shale oil at a record rate, has been leaning on Iraq to resume production at northern fields around the city of Kirkuk and to resolve its oil-revenue disputes with the Kurdish administration.

Saudi Arabia raised oil production to a record high in November, an industry source said on Monday, pumping 11.1 million to 11.3 million barrels per day (bpd). "It will be interesting to see if Saudi-Russia can keep the floor in place". It resumed pumping crude for export by pipeline from northern fields this month and is expanding capacity to produce at its main deposits in the south.

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Why do oil prices fluctuate?

The chart shows the cost of production of oil and gas per barrel for the countries by using data from Rystad Energy UCube and The Wall Street Journal. It needs crude above $73 on average next year to balance its budget, according to the International Monetary Fund. -China trade war a key focus.

Saudi Arabia can not afford another slump in oil prices.

Analysts believe that Russian Federation agreeing to reduce production would be crucial for the OPEC/non-OPEC group to hammer out an agreement to cut.

Brent oil edged down towards $60 on Wednesday, erasing early gains of more than 1%.

There is need of a cut, but Russian Federation doesn't want to chip in with a large cut, a second source told Reuters. Putin previously said Russian Federation would be satisfied with a price of $70. That doesn't mean the Kremlin is about to give up its alliance with Saudi Arabia, which extends beyond oil, but it means could drive a hard bargain.

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The cooperation had been a "a 100 percent" success, Putin said, adding that this was largely due to Saudi Arabia and Crown Prince Mohammed bin Salman, the "initiator" of the deal.

"Perhaps the recent increase in OPEC production is actually the strongest signal that it intends to announce a cut, as members jockey for position ahead of the debate about who should bear the cuts - this has happened before".

But Naimi warned repeatedly that the burden of OPEC and non-OPEC production cuts would fall most heavily on Saudi Arabia and the main beneficiaries would be USA shale producers, and time has proved him correct.

The consensus is that the Saudis have few good options.

“The next OPEC meeting is going to prove a pivotal moment for the direction of oil prices in 2019, ” BNP Paribas strategist Harry Tchilinguirian told Reuters Global Oil Forum.

"At the heart of the malaise are concerns that OPEC+ will not do enough to address the current oversupply", said Stephen Brennock, analyst at London brokerage PVM Oil.

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