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Takeaway: Tuesday, Dec 4 Conference Call on OPEC Meeting Preview with former OPEC President & Algerian Energy Minister.

OPEC PREVIEW CONFERENCE CALL:

  • Tuesday, December 4, 2018
  • 10:00 AM (Eastern Time)
  • Toll Free:
  • Toll:
  • UK: 0
  • Confirmation Number: 13685590 

Join us for an OPEC Meeting Preview call on Tuesday morning (eastern time) with former OPEC President & Algerian Energy Minister Chakib Khelil to get an assessment of OPEC’s next moves at its December 6-7 meeting in Vienna. Minister Khelil will join us from Algeria to provide his views on oil market and next steps for OPEC.

With oil prices down 33 percent since October, OPEC's meeting this week promises to be highly consequential to oil markets. OPEC meets on December 6 and then meets jointly with its non-OPEC partners, the OPEC+ group on December 7.

CALL TODAY: WILL OPEC MAKE BIG CUTS AT DEC 6-7 MEETING? - OPEN

Saudi Arabia Energy Minister Khalid al-Falih is clearly leading an effort to produce an agreement for a collective OPEC+ cut at the December meeting in Vienna. We think current low oil prices have made his work much easier and expect wide agreement for OPEC to take action to address its own forecasts of slowing demand growth and a supply surplus in the first half of 2019. At these current low prices, we think even Iran will be supportive of a production cut.

Hedgeye's forecast is that the OPEC meeting will decide to cut production in excess of 1 million barrels per day (b/d). Still unclear is how OPEC will package its cut and what will be its baseline.  At current production rates, we could see a massive cut.  For example, a news report this week said Saudi Arabia production in November hit a record peak of 11.3 million b/d to meet demand from Iran’s former customers and to demonstrate that it could produce at such a record level.  

Due to seasonal demands and previous production rates, it seems hard for us to see Saudi Arabia producing more than 10 million b/d in January. If you accept that Saudi November production was as high as 11.3 million b/d, then we are looking at a cut of 1.3 million b/d from Saudi Arabia alone in January. 

Minister Khelil will take us inside the OPEC decision making process and discuss the following topics:

  • His and OPEC’s view of current market conditions;
  • Will OPEC cut production and by how much;
  • Will Russia cooperate in the production cut and by how much;
  • What price point/range is OPEC's goal;
  • What are the chances that OPEC reverses course and boosts supply to depress US Shale;
  • Any OPEC surprises & your questions.

The call will be hosted and moderated by Hedgeye’s Senior Energy Policy Analyst Joe McMonigle who is in Vienna this week to attend the OPEC meeting.

We will be distributing an audio replay shortly after the call concludes.

Kind regards,

-The Hedgeye Macro Team