Oil prices inch higher amid OPEC jitters, set for first positive week in 5

Oil prices rose slightly in Asian trade on Friday as traders remained on edge over a delay in an OPEC+ meeting, although expectations of more supply cuts by the cartel put prices on course to break a four-week losing streak.

Trading volumes were muted with U.S. markets closed for the Thanksgiving holiday.

While crude prices were set to rise for the week, gains were paltry after an unexpected delay in a meeting of the Organization of Petroleum Exporting Countries and allies (OPEC+).

The meeting was delayed to November 30 from November 26, with media reports suggesting some disagreements between member countries over planned production cuts.

Reuters reported that African producers- specifically Angola and Nigeria- wanted to increase output, to the chagrin of Saudi Arabia and Russia, which are considering deeper production cuts to offset a recent slump in oil prices.

Brent oil futures rose 0.3% to $81.67 a barrel, while West Texas Intermediate crude futures rose 0.4% to $76.69 a barrel by 20:42 ET (01:42 GMT). Both contracts were up around 0.8% for the week- their first positive week after an extended rout brought prices to near four-month lows.

Still, bigger gains for the week were stymied by data showing a substantially bigger-than-expected increase in U.S. inventories. The reading, which also showed U.S. production remaining close to record highs, suggested that crude markets were not as tight as initially expected.

This notion is likely to invite more production cuts from the OPEC+, although disagreements over output may limit the full extent of any planned supply reductions.

Saudi Arabia and Russia have led the OPEC+ in cutting supplies this year. But their output reductions have so far provided only fleeting support to oil prices, as fears of worsening economic conditions and slowing demand kept prices trending downwards.

A string of weak economic readings this week also pointed to weakening conditions in major global economies. Purchasing managers index data from Australia, the euro zone and Japan all showed business activity remained in contraction through November, amid pressure from high interest rates and inflation.

Focus is now on PMI readings from top oil importer China, which are due next week. While the country’s oil imports have remained steady this year, a massive build-up in its inventories and stricter refining quotas have raised some concerns over a demand slowdown in the coming months.

Chinese economic data has also largely underwhelmed this year, as a post-COVID rebound failed to materialize.