The Organization of Petroleum Exporting Countries gathers and begins two days of meetings on the course of its production policy.
It’s commencing two days of meetings that will have a huge influence on oil prices for the foreseeable future.
Over the last month, oil prices have rallied sharply. Investors are hoping that widely available vaccines will give people from all nations more confidence to travel next year. That’s after the biggest ever drop in global consumption this year.
OPEC has to decide whether the improved outlook for demand actually warrants the 1.9 million barrel a day increase. This is what OPEC and its allies (chiefly Russia) have pencilled in for January 1.
Reports over the weekend reinforced the consensus that the group may delay that increase for up to three months. This is due to the second wave of the pandemic hitting Europe and North America. The recent surge in prices, however, has increased the risk that one or more of the producer groups will break ranks.
Meanwhile, the outgoing Trump administration is set to add to the blacklist of companies off limits to U.S. partners. It is adding one of the world’s biggest chipmakers and China’s second-largest oil producer.
More to Add to the Blacklist
Weekend reports said that the administration will add China National Offshore Oil Corp and Semiconductor Manufacturing International (SMIC). Moreover, it will also include China Construction Technology Co. Ltd. and China International Engineering Consulting. They will be added to a list of companies controlled by the Chinese military with already 31 names on it.
Though the report hasn’t been confirmed yet, CNOOC stock declined 14% in response to the move.
The U.S. has already leaned heavily on the Dutch government to ensure that ASML can’t sell them to SMIC. ASML makes the machines that make the world’s high-performance chips.
Elsewhere, Taiwan’s Global Wafers agreed on Monday to buy Germany’s Siltronic for $4.5 billion.
President Donald Trump Eyes Supreme Court Bid
Outgoing President Trump said at the weekend he’ll leave the White House if the Electoral College votes for Joe Biden.
Both he and his legal team indicated that they intend to make one last appeal to the Federal Court. That is to pursue claims of electoral fraud that was thrown out of 38 of 39 lower courts so far.
Meanwhile, President-elect Joe Biden continued to organize his economic team. He tapped labor economist Cecilia Rouse to head the Council of Economic Advisors.
Moreover, Neera Tanden, head of the Center for American Progress, to be director of the Office of Management and Budget. Adewale Adeyemo, who served Barack Obama as an international economic adviser, is to become Janet Yellen’s deputy at Treasury.