4 Key Oil-Related Events That Investors Need To Know
Ellen R. Wald, Ph.D | Aug 08, 2018 01:52AM ET
1) On August 20, the OPEC and non-OPEC Joint Ministerial Monitoring Committee (JMMC) will hold its second teleconference meeting. The last meeting was held on July 18, at which OPEC producers selling winter blend gasoline. In preparation for this, refineries generally start producing winter blend in August. Refineries typically go offline for maintenance as they complete the switchover, which somewhat lowers oil demand. However, impact on demand should not be shocking, because the switchovers are generally staggered. Winter blend gasoline is cheaper to produce because it contains more butane and fewer blended elements designed to reduce air pollution. Typically, consumers see a drop in gasoline prices after the switchover.
3) On or after November 5, the United States plans to hold its next regular meeting on December 3, in Vienna. It will be followed by a non-OPEC Ministerial Meeting, at which analysts are hoping the group will reveal details of the new “super-OPEC” institution. The question of whether Russia will maintain its cooperation with OPEC is of great importance. Saudi Arabia has gone to great lengths to keep Russia involved in both supply cuts and increases over the past year and a half, but there remains a possibility that Russia will decide to leave the group and pursue its own agenda. Russia’s participation and cooperation depends entirely on whether that cooperation is seen as furthering the country’s own interest. Will the country still see cooperation with OPEC in its interest if oil prices increase significantly by December? If not, it might very well decide not to join a “super-OPEC” institution. Or it may press for the institution to take the shape of a symbolic group for furthering discussion rather than for setting out measures.
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