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Skip Navigation Oil prices could soon return to $100 as OPEC+ considers ‘historic’ cut, analysts say * watchliveFast Money Markets * Pre-Markets * U.S. Markets * Europe Markets * China Markets * Asia Markets * World Markets * Currencies * Cryptocurrency * Futures & Commodities * Bonds * Funds & ETFs Business * Economy * Finance * Health & Science * Media * Real Estate * Energy * Climate * Transportation * Industrials * Retail * Wealth * Life * Small Business Investing * Personal Finance * Fintech * Financial Advisors * Options Action * ETF Street * Buffett Archive * Earnings * Trader Talk Tech * Cybersecurity * Enterprise * Internet * Media * Mobile * Social Media * CNBC Disruptor 50 * Tech Guide Politics * White House * Policy * Defense * Congress * Equity and Opportunity * Europe Politics * China Politics * Asia Politics * World Politics CNBC TV * Live Audio * Latest Video * Top Video * CEO Interviews * Europe TV * Asia TV * CNBC Podcasts * Digital Originals Watchlist Investing Club * Trade Alerts * Jim’s Morning Thoughts * Analysis * Morning Meeting * Trust Portfolio PRO * Pro News * Pro Live * Subscribe * Sign In Menu * Make It * USA * INTL Search quotes, news & videos Watchlist SIGN IN Create free account Oil prices could soon return to $100 as OPEC+ considers ‘historic’ cut, analysts say * watchliveFast Money Markets Business Investing Tech Politics CNBC TV Watchlist Investing Club PRO Menu Energy OIL PRICES COULD SOON RETURN TO $100 AS OPEC+ CONSIDERS ‘HISTORIC’ CUT, ANALYSTS SAY Published Mon, Oct 3 20226:43 AM EDT Lee Ying Shan@LeeYingshan Sam Meredith@smeredith19 WATCH LIVE ShareShare Article via FacebookShare Article via TwitterShare Article via LinkedInShare Article via Email Key Points * OPEC and non-OPEC producers, a group often referred to as OPEC+, will meet in Vienna, Austria on Wednesday to decide on the next phase of production policy. * The oil cartel and its allies are considering an output cut of more than a million barrels per day, according to OPEC+ sources who spoke to Reuters. * “The OPEC ministers are not going to come to Austria for the first time in two years to do nothing. So there’s going to be a cut of some historic kind,” said Dan Pickering, CIO of Pickering Energy Partners. watch now VIDEO2:0602:06 Energy inflation will stay over next couple of years: Financial services firm Street Signs Asia An influential alliance of some of the world’s most powerful oil producers is reportedly considering their largest output cut since the start of the coronavirus pandemic this week, a historic move that energy analysts say could push oil prices back toward triple digits. OPEC and non-OPEC producers, a group often referred to as OPEC+, will meet in Vienna, Austria, on Wednesday to decide on the next phase of production policy. RELATED INVESTING NEWS Energy stocks climb on reports of OPEC+ production cuts. Here’s how we’re responding Kevin Stankiewicz a day ago The oil cartel and its allies are considering an output cut of more than a million barrels per day, according to OPEC+ sources who spoke to Reuters. “The OPEC ministers are not going to come to Austria for the first time in two years to do nothing. So there’s going to be a cut of some historic kind,” Dan Pickering, CIO of Pickering Energy Partners, said, referring to the group’s first in-person meeting since 2020. However, Pickering said he expects the actual number of barrels coming off the market will likely be around 500,000, which is “going to be enough to support the market in the near term.” Oil prices rose around 4% on Monday morning. International benchmark Brent crude futures popped 4% to $88.54 per barrel, while U.S. West Texas Intermediate futures climbed 4.2% to trade at $82.83 per barrel. Crude oil storage tanks at the Juaymah Tank Farm in Saudi Aramco’s Ras Tanura oil refinery and oil terminal in Ras Tanura, Saudi Arabia, on Monday, Oct. 1, 2018. OPEC+ is mulling slashing output of more than a million barrels per day, according to sources. The move would mark the biggest undertaken by the organization to address weakness in global demand. Simon Dawson | Bloomberg | Getty Images Stephen Brennock, a senior analyst at PVM Oil Associates in London, said Monday that there appeared to be some upside potential for oil prices after heavy losses across the board in September. “A further uptick in trading activity coupled with tightening near-term oil fundamentals could well push oil prices back to $100/bbl,” Brennock said in a research note. “Those of a bullish disposition have endured a summer of pain, but a winter of hope and expectation is on the horizon,” he added. Echoing this call of a return to $100 a barrel, analysts at Goldman Sachs see Brent reaching triple digits over the next three months, before climbing to $105 over a six-month horizon. The U.S. investment bank expects WTI to jump to $95 by around year-end, before hitting $100 over the next six months. OPEC HAS RESOLVE TO SUPPORT PRICES OPEC+ is signaling that their support of oil prices will not happen at around $50 to $60 per barrel, Pickering said. “It’s going to happen much higher, and they’re showing a resolve to protect price. They’re less worried about demand.” > Despite what people will say, we’re gonna see some pretty sticky energy > inflation as we move forward over the next couple of years. > Dan Pickering > CIO, Pickering Energy Partners Pickering told CNBC he does not think an Iran nuclear deal will happen, and that the real concern would be how recession risks will stoke demand fears. Last month, oil prices declined by more than $4 to their lowest level since Russia’s invasion of Ukraine in late February, following demand concerns due to recession fears. Asked whether a massive output cut from OPEC+ would likely be enough to send oil prices back to their June high, Saxo Bank’s Ole Hansen said, “I don’t think it is because what we have to consider is that OPEC+ has been struggling now for months to actually produce the quota levels they had agreed.” “If they do cut by 1 million or by 1.5 million, they will have to change the quota system for that number actually to be a real cut in the market,” Hansen told CNBC’s “Worldwide Exchange” on Monday. “It is probably also the reason why they are meeting face-to-face this week in Vienna because it is potentially a highly controversial decision that they may take. But I think the impact is probably going to be less than what the market is looking for,” he added. SUPPLY-SIDE FACTORS In addition to a production cut by OPEC+, Pickering cited other supply-side factors that will also prop up oil prices for the next four to eight weeks. “We’re going to see more support from the supply side if sanctions kick in from Europe towards the end of the year [and] as the U.S. [Strategic Petroleum Reserve] begins to shut down its deliveries in November,” he said, referring to the U.S. government’s emergency stockpile that’s tapped when energy markets are in turmoil. A few weeks ago, the U.S. Energy Department announced it would sell up to 10 million barrels of oil from the SPR for delivery in November. Storage tanks and oil processing facilities operate beside the Arabian Sea at Saudi Aramco’s Ras Tanura oil refinery and terminal in Ras Tanura, Saudi Arabia, on Monday, Oct. 1, 2018. The upcoming OPEC+ meeting in Vienna will result in an oil production cut “of some historic kind”, said CIO of Pickering Energy Partners, Dan Pickering. Simon Dawson | Bloomberg | Getty Images The EU’s sanctions on seaborne imports of Russian crude will kick in in December. The ban could exacerbate worries over an already tight energy market, brought on by strong demand as economies bounced back from the pandemic. “OPEC is no particular friend of oil price softness, gasoline prices going down … despite what people will say, we’re gonna see some pretty sticky energy inflation as we move forward over the next couple of years.” At the start of September OPEC surprised markets and announced a small oil production cut of 100,000 barrels per day to bolster prices. TV Fast MoneyWATCH LIVEWATCH IN THE APP UP NEXT | Mad Money 06:00 pm ETListen TV Fast MoneyWATCH LIVEWATCH IN THE APP UP NEXT | Mad Money 06:00 pm ETListen Trending Now 1. Trump and GOP defend Herschel Walker after abortion accusation rocks Georgia Senate race 2. Twitter shares surge 22% after Elon Musk revives deal to buy company at original price 3. 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