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Oil Prices Slip as OPEC Meeting Looms
DOW JONES & COMPANY, INC. 9:29 AM ET 11/24/14
Oil prices fell Monday on expectations that the Organization of the Petroleum Exporting Countries would not cut production enough to reduce a global glut of oil.

Light, sweet oil for January delivery slipped 61 cents, or 0.8%, to $75.90 a barrel on the New York Mercantile Exchange.

Brent, the global benchmark, fell 60 cents, or 0.8%, to $79.76 a barrel on ICE Futures Europe.

Oil prices have plunged in recent months on concerns about ample global supplies, and traders have closely watched OPEC ahead of its Nov. 27 meeting. The cartel, which controls about one-third of global oil output, is currently producing above its collective production quota of 30 million barrels a day. Analysts say the group would have to cut production by at least a million barrels a day to bring global supplies closer in line with demand.

However, OPEC members, including top exporter Saudi Arabia, have signaled that the group is unlikely to make a large, coordinated cut.

"No action would be met with a yawn, but [would] ultimately keep downward pressure on oil prices," said analysts at Tudor Pickering Holt & Co. in a note Monday.

Many analysts are calling for the cartel to either cut production by a small amount or vow to better enforce its current quota.

"Consensus expectations have...shifted to only expecting a modest cut," said analysts at Goldman Sachs in a note. " We estimate that it would require a cut in production of more than [500,000 barrels a day] to below the current quota for prices to rally significantly next week."

Iran and the six-power group are extending nuclear negotiations until the end of June 2015 after failing to reach an agreement by Monday's deadline. That means sanctions on Iranian oil exports, which are keeping hundreds of thousands of barrels of oil off the global market, could potentially be lifted in the coming months.

December reformulated gasoline blendstock, or RBOB, fell 1.3 cents, or 0.6%, to $2.0435 a gallon.

December diesel slipped 1.9 cents, or 0.8%, to $2.4855 a gallon.

Write to Nicole Friedman at [e-mail]

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(END) Dow Jones Newswires
11-24-140929ET
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