WTI holds steady above $68.00, all eyes on OPEC+ meeting

• WTI price trades sideways around $68.85 in Friday’s early Asian session. 
• The ongoing Russia/Ukraine conflict highlighted risks to Russian oil supplies, which might lift the WTI price. 
• OPEC+ postpones its next meeting on output policy to December 5 from December 1. 

West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $68.85 on Friday. The WTI price steadies as the escalation in the Russia/Ukraine conflict offsets a less aggressive rate cut expectation from the Federal Reserve (Fed).

Oil traders will closely monitor the developments in the Russia/Ukraine conflict. Any signs of escalation could raise concerns about energy supplies, particularly winter gas flows to Central and Eastern Europe, boosting the WTI price. On Thursday, Russian President Vladimir Putin said that if Ukraine gets nuclear weapons, Russia will use all means of destruction. 

Wednesday’s US economic data suggested that the progress on lowering inflation appears to have stalled in recent months, which could diminish the expectation for the Federal Reserve (Fed) to cut interest rates in 2025. However, they expect the Fed will leave rates unchanged at its meetings in January and March. It’s worth noting that slower-than-expected rate reductions would keep borrowing costs high, which could slow economic activity and lower oil demand. 

The Organization of the Petroleum Exporting Countries and its allies (OPEC+) postponed its December meeting, fueling speculation about delayed production hikes and supply adjustments. OPEC+, which accounts for about half of world oil output, is scheduled to meet on December 5 after delaying its earlier meeting. 

Key considerations include whether to prolong the voluntary production cuts of 2.2 million barrels per day slated to phase out in December. Reports suggest members are considering delaying planned output increases for January amid persistent demand uncertainties. A further delay has mostly been factored into oil prices already, said Suvro Sarkar at DBS Bank. "The only question is whether it's a one-month pushback, or three, or even longer.”