Crude oil markets recovered last week from a three-month low, fueled by speculation that the 14-member Organization of the Petroleum Exporting Countries (OPEC) would come to an agreement on productions cuts, the first since 2008.
That trend continued Monday as Brent crude futures for January delivery opened at $47.01 on the CME Globex, reaching a mid-day high of $48.38 and a low of $47.00. March contracts broke $50, reaching $50.25 after opening $49.46 with a low of $49.46.
But OPEC's November 30 meeting in Vienna will have to deal with those contrarian members that want to open up the spigots wider.
The oil cartel is seeking cuts of between 32.5 million and 33 million barrels a day from record levels of 33.83 million barrels during the third quarter.
Some analysts say supply disruptions among OPEC members such as Nigeria could drive prices up. But Iraq and Iran are asking for exemptions--Iraq because of demands related to the war against ISIS and Iran because it has recently re-entered the market following the decades-long sanctions that were lifted early this year. At a meeting in Doha Friday, a number of OPEC oil ministers indicated that Iran would be given flexibility on production.
Brazil, Canada, Russia and the United States are non-members that are beyond OPEC's control. Russian Energy Minister Alexander Novak, who attended Friday's Doha meeting, said he thought OPEC was moving closer to a deal. If an agreement were reached, Russia was prepared to cap output for six months or longer, Novak said.
The victory of climate change skeptic Donald Trump in the U.S. Presidential election will also likely be a brake to any price rise. Any green light on stateside exploration and production will become even greener.
In a deal that has been heralded as a harbinger of things to come in an environment of deregulation, Sunoco Logistics said Monday it is buying pipeline provider Energy Transfer Partners for nearly $20 billion.
A November 14 New York Federal Reserve Bank Oil Price Dynamics Report noted that "for 3Q 2016, oil prices were somewhat lower as a result of volatile but weakening global demand expectations as well as looser supply conditions."